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Friday, 02/05/2021 10:01:34 AM

Friday, February 05, 2021 10:01:34 AM

Post# of 5650
So Much For the All-Time High Being In

http://www.pretzelcharts.com/

'Well, the very slight lean (51/49) toward another leg down was a whiff. I was a bit concerned from the beginning because ES looked like 3 waves into the high, which suggested a b-wave, by I ignored my better angels on that one. This does suggest that the prior decline was indeed a fourth wave, which puts us into a fifth wave that will likely see at least a decent correction when it completes -- but first, it does need to run its course. And because this has been a market that loves extended fifths (seems to be a byproduct of Fed intervention/government "stimulus"), we do have to keep alert to that possibility.

One can't usually predict the occurrence of extended fifth, so it's just something to be aware of at this stage -- but for awareness sake, an extended fifth in this position could run as high as the high 4000s (meaning 4800-4950). Yes, you read that right. Again, not a prediction, just an option the market reserves for bulls' best case scenario.

In the meantime, SPX is back above the intermediate black trend line, which has caused more problems than a politician with a microphone:"



"Near-term, the chart looks something like this:"



"In conclusion, SPX is likely now into a fifth wave, but we should expect that to run at least a bit higher before bears get another chance (barring a complex fourth, shown in gray). Trade safe."
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