Ideal Roadmap For the Next Few Months

I pointed out a fib on Friday that could support an immediate drop from here. It’s not perfect though (it’s only one good fib relationship at Friday’s high—that I could find). And it’s a little uncommon to drop straight from a high (and also have it stick). Those are often retraced soon (not always). It is preferable to see a drop during the day that is covered to some degree into a close. Those have a higher chance of producing downward gaps that can stick.

I do not know if they are going to rug us now, or hold us up here for part of this week to do some distributing. If they do hold us up here, there is a host of excellent fibs just above us at about 4200 (I recounted the whole structure this weekend from scratch).

If they do some distributing, we may congest up here, toward the end of which we could get a little poke to 4200 where all those fibs and 250-day EMA are before a more serious decline begins. If we do that, I would expect a pause at 4000, then a bigger drop to the 250-week EMA, another pause, then a final drop to 3188 or so where there is a host of other fibs. After that, I would then expect a rally back to the 250-day EMA which could coincide with 4000 again out there projected as the pink B; lil’ holiday rally over there.

SPX

If we do get a decline here, it should last through most of September to get down there to pink A. If we do end up doing all of this, we will be replicating the dot-com fractal somewhat eerily closely and it could mean that the rest of the structure will become very intelligible to us. This choppy shit we’ve been in all year will clear up a lot and things will become easier (at least for me) to understand. The next several swings should be somewhat predictable, and a lot of fun—multiple V-bottoms, lots of motion, not so much chop.

If we do end up puking hard straightaway, I will look to begin assessing whether we are already in the move to pink A or not. Under 4000 and that becomes more likely.


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