[S+P500] update

At the backlink I was looking for a double top to begin moving lower per the model below:



Importantly, and to the detriment of the model, the herd pushed past center channel per the updated weekly S+P500 chart below.  At the same time, the center line could not be held and that is not bullish.  Generally if these are going higher they either bump up against the middle rail from below, cannot make it, and then fall back and break out OR they break out on the first wave up like this one did but then back test that centerline from above.  Falling back below is every bit as bearish as breaking above was bullish.  We now have to be open to the possibility that this will turn into a large 4th wave HT with sideways action eating up a good deal of 2016.  THIS IS FINE BY ME!  4th waves are fantastic to trade if you can see them coming in time.  Of course, after the 4th would come a 5th higher - Avi's model.  By then I would expect that gold and miners have already begun a new bull market.

So if a HT is about to form then A of 4 and B of 4 are done and now working on C of 4 which should find support near the lower rail.  That would do wonders for UVXY.  And of course, we will be watching how that support works out.  If the chart falls to a lower low than the August low then the HT is cancelled with bearish implications for the markets (which will make UVXY an all star).



Zooming in on just the sell off from the peak we have the chart and model below.  The reason I bailed out of UVXY yesterday is because of W3 here and because of the wave count in UVXY looking like a 3rd.  Today looks like a 4th.  Count the 5-3-5 waves up, very clear IMO.  Note that it petered out at the 38.2 fib of just the 3rd wave (see where I started the fib calculator?).  Is this coincidence?  Not likely and I don't believe in them anyhow.

I also want to point out the blue horizontal which marks the peak of wave 1 up from the bottom.  W3 just managed to poke back into the range of it meaning the current pullback cannot be wave 4. So while higher highs may still happen, the market is not ready for that right now.

Because of all these things, I doubled my prior position in UVXY in the early minutes of the extended trading session and I will be VERY quick to dump it all tomorrow if this continues moving past the 38.2 line not because of the 38.2 line per se but rather because it will ruin my bearish count and the wave count trumps all other indicators, hands down.