Wednesday, August 28, 2013

Charts 08-28: An even larger ending-diagonal and a zig-zag 5th wave

McHugh called Syria a "black swan" right away yesterday, and I don't think he is right ... yet.  Thankfully, the good folks in Russia and China (!) have spoken out on this pending imperial overreach, and there is still time for us to back off and turn this over to the State Department for now.

The tape was very interesting early this week.  I had drawn this little trendline up to SPX 1740, and we were tracking it like a magnet, drawn to it, oscillating around it.  This chart shows how we fell away from it once the Syria story broke.

So are we providing an Air Force for al-queda or AIPAC?  There is still time to stop reading the programming from the TelePrompTer and reconsider.  Empty suit ...

Should "Syria" get put on hold, a sharp rally will ensue.  It would set up the elusive inverse head-and-shoulders here for a nicely-balanced ZIG-ZAG 5th wave:

SPX 08-28 zig-zag 5th wave

A zig-zag 5th wave?  How can that be?  Maybe if it's part of a much larger ending-diagonal, since SPX 1266, like this:

SPX 08-28 2Y - ending diagonal count

The SPX 1768 area, by Friday, September 20, before the German elections, completes the rally and we fall apart.  The serious stuff begins in May of 2015.

SPX 08-28 5Y

4 comments:

Permabear Doomster said...

If your outlook is correct, it will negate EVERYTHING in the past month, and frankly, I'd be utterly dismayed.

The weekly charts are kinda pretty important, and they are STILL saying the near term trend is down.

I realise the bull maniacs could still turn this market higher, but really...you're calling for new highs..even though the bigger trend is still to the downside.

No doubt..the last line is 1709.

If you're right, I lose my chair at the casino table.

aacfd2b6-1174-11e3-b428-000bcdcb2996 said...

Hi CG

Where is Lunatic posting? Gave up Gold status @ Dennigers site

Christian Gustafson said...

Nowhere ... get this ... Luna found a girl.

I warned him about this, but I'm two states away and there was nothing I could do. Worst damned thing that can happen.

I have offered him posting rights on this blog, but he has not taken me up on it. Maybe he will reconsider once the market finally tops and we wake up to a new Bear.

He's always willing to share. I'll ping him from time to time to see what's on his mind.

Maybe we will be lucky and he will post regularly again, either here or on his own blog.

sooner said...

Luna found a girl? That explains as lot!