Long-Term $SPX Wave Balance and Count Revision

I have been speculating that the rally off the June low was misleadingly corrective in nature, in that, from the July low, we may have had an impulse wave up to the August high, followed by a 2 here (whereas most people would see a corrective rally only). But, if this is a 2, it’s now gotten very big, and it’s also taken a lot of time. It now looks disproportionate.

In sniffing around for an alternative, we hit an interesting spot at the close today that I would like to share with you.

If we count it like this, as an a-b-c in cycle (yellow) degree, we can see 5 waves down for yellow a (with the 5th pink wave of that yellow a wave being truncated up there), and that matches nicely with 5 waves down for yellow c, with yellow c coming within ten points of equaling yellow a at the close:


That’s a nice balance.

On the one hand, one thing I lose is targets that I had at the all-time high. Those were generated from the length of what I thought was a wave 1 (which is now the yellow b in this chart). But on the other hand, we may get a real stunner of a rally, as we may be coming out of a low of both cycle (yellow) and supercycle (purple) degrees, and we haven’t come out of waves of those degrees since the COVID low. It also means we may go somewhat significantly higher than the all-time highs, instead of simply reaching them. I am unsure for now. We may rally all year next year, and not simply into next year. Let’s keep an open mind.

This is contingent upon us recovering these overnight losses, and we just might. The COVID crash, after all, also of this degree, bottomed overnight, too.

With all of the data points I am seeing that point to a major low being put in, it is possible that a major low has been set in place here.

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