SPX, RUT, INDU, BKX: Intermediate Charts

(Note:  5 charts today, so the update is continued on a second page...)

So there are "difficult" markets, and then there are markets like this one, which basically cater only to the "permas."  By that, I mean they can be hard to trade if you think too much.  If you're simply a perma-bull in your approach ("BTFD! Duh!"), then you're a "genus"! (And probably a "phylum" as well!).  As someone whose name I'm too lazy to look up at the moment once famously said: "Don't confuse brains with a bull market."  Or was it: "Don't confuse brawn with Chuck Norris"?  No matter.  The point is, markets like this reward the True Believers and punish everyone else. 

That is, until they don't, of course -- at which point the True Believers get wiped out. 

But for now, the True Believers are still reaping bragging rights, and maybe eking out some amount of profit here and there, depending on how many times they've given it all back by buying near the top and selling near the bottom, and how many times they've held through massive drawdown only so they could, in the end, say: "See?  I KNEW it would come back!  BTFD -- the only way for me! Yo."

SPX finally cleared its all-time-high, and INDU has broken above prior resistance (in any bull move, step one is to break prior resistance, step two is to hold that and for resistance to act as support.  Step two has yet to be determined here.):

RUT has continued on a rocket-launch trajectory:

Continued...

SPX Upd (too short to be called an "Update")

Well, on top of the fact that there's not really anything to add to Friday's update, my internet quit for a couple hours tonight, and while it's been back on for a bit now, it's slowed to an absolute crawl -- so today's update will be super-short.

Basically, just the updated SPX chart, which includes a note about the long-term potential in the event of a sustained breakout:

Wow, it just took 18 minutes to upload that chart (!). 

Luckily there nothing else to add, really.  Trade safe.

BKX, INDU, RUT, SPX: Longer-term Views of the Charts

Today we're going to look at a few larger views of markets, but I'm going to let the charts do most of the talking.

Let's start with the long-term BKX chart, which I've only updated a handful of times since -- holy cow -- January 2013 (see bottom-most annotation).  There may be a correction pending, since BKX is challenging intermediate resistance, but by all normal rights, it's hard to imagine this BXK pattern not ultimately continuing higher toward black V.  So, even if there is a correction soon, odds are reasonable that it will be a buy op.

Next is RUT, which is also challenging intermediate resistance:

INDU is challenging a resistance zone as well:

And, of course, so is SPX, in the form of the all-time-high:

In conclusion, multiple markets are challenging intermediate resistance zones.  Normally, we'd expect some sort of reaction from those zones, and thus be on the lookout for a correction to begin soon.  As I've said for quite some time, though (sometimes directly, sometimes indirectly), it's worth a reminder that the odds are good that we're still in a larger bull market -- so, from our present vantage point anyway, it still appears that if we do have a correction soon, it will likely end up being a buy op in the long run.  Though, if we are in the midst of fifth waves higher, maybe not such a great deal in the LONGEST run, if you catch my drift -- but buy ops for the directly foreseeable future, anyway.  Trade safe.

SPX and RUT: What Might We Expect if the Market Breaks Through the Current Inflection Zone?

SPX has continued to remain below the all-time-high, but before we look at that (currently boring) chart, let's look at RUT, and consider the implications if the current inflection zone fails to put the brakes on the market:

The updated 60-minute RUT chart contains some discussion about a distinction that I believe is one of the most important understandings for people with an appetite for risk (present company included):

I made a slight adjustment on the SPX chart, although it amounts to a moot point if the market ends up simply barreling through the current inflection zone. 

In conclusion, SPX remains in an inflection zone, so this is the place for bears to take a stab if they're so inclined.  Yesterday presented a second opportunity at 2180, with manageable risk -- now all that's left is to watch and wait for the market to do its thing, or not.  On balance, I'm probably still inclined to think we head toward red C, but it's far from being a clear call.  Along those lines, I again feel obligated to restate how important it is to respect any sustained breakout from the market's current position, should a sustained breakout occur.  Trade safe.

SPX and INDU Updates

Friday was an inside day, remaining within the range of Thursday's prices.  This leaves things little changed from the prior update, so today we're simply going to give the bulls some additional intermediate airtime via the Dow Jones Industrial Average.

First up is SPX, which hasn't changed materially.  I am still very alert to the fact that SPX found support and staged a strong rally from the standing tongue-in-cheek "Bull 2 (or something)" zone that has been posted on this chart for a couple months now.  That's one of the fun things about Elliott Wave -- you might not always be able to predict exactly what the market will do, but you can often identify the key inflection points that could reverse the market.  As they say, forewarned is forearmed... so at least the possibility of a strong bounce/rally from the 2100 zone was something we were aware of well ahead of time.

On INDU, I've filled in a few of the potential bull targets with a bit more detail.  I really didn't buy into the pattern as huge 1-2 bull nest, but if INDU doesn't reverse soon, then I'm going to have no reasonable choice but to treat it as that most bullish 1-2 option until the market says not to.  As I discussed back in July, this has always been a difficult pattern for bears, because (as I wrote then) "their main hope is a big counter-trend decline."  So if this breakout sticks, then we'll just have to assume that counter-trend decline isn't going to be materializing for the time being.

In conclusion, it's still "last call for bears."  So far, they've managed to at least slow, and partially reverse, the rally at the 2180 SPX inflection point.  But from here, if bulls can sustain a solid breakout over the all-time-high, then bears will probably need to hibernate for a while.  There is significant potential energy in this pattern, so bulls may be able to capitalize on that and keep the rally going for longer than will seem reasonable.  Trade safe.

SPX and RUT: Last Call for Bears

When we broke 2119 to the downside back in early-October, my first instinct was that SPX was forming an expanded flat, and that we'd see a rally, in wave 2/B, to 2180 SPX.  Then we had another breakdown, and I wrote that the 2/B rally was still alive, but that we had to "assume the most bearish count until proven otherwise" -- because what else can you do at that point?  There are times the market sets itself up into a pattern with great potential energy, and that energy always has to be respected -- in much the same way that you wouldn't run around blindly in an open field during a violent electrical storm.  Maybe you won't get hit by lightning, but you have to deeply respect that you very well could be.  But just as with an electrical storm, sometimes that energy never connects, and thus never gets farther than the "potential" stage.  Unfortunately, there's just not much you can do about it other than protect yourself along the way via stops.

Yesterday, we finally reached 2180+, which was the target for the 2/B count, and SPX reacted to that zone with a decent rejection.  Now it's up to bears to keep pushing.

In the event SPX sustains a breakout over the all-time-high, then we're back into a situation where we'd need to respect the potential energy of the pattern, but this time to the upside.  From a technical standpoint, do be aware that a break of the ATH does NOT technically invalidate the bearish C-wave.  It just makes it really hard to trade, and possibly ill-advised (running around an open field during a lightning storm again...) until there's an impulsive downside reversal.  Thus, bears would like to see the ATH hold, because that makes the trade manageable, and keeps the stop zone clear.

Somewhere in here, I need to note that it's worth a reminder that the bond market is closed today due to Veteran's Day, so I'm putting that here.  Or, uh, "there" (see prior sentence), as the case may be.

RUT has been a rocket ship ever since its target capture:

Of note, INDU did breach its all-time-high.  From an Elliott Wave perspective, that breach can still potentially be counted as a fifth wave, so it's not the end of the world for bears just yet... but they do need to make a stand pretty darn soon to hold out hope for an intermediate decline.  It's the moment of truth for the 2B wave, and for bears in general... at least for the immediate future.   Trade safe.

Updates for the (soon to be renamed) Trump 500 ($SPX) and The Trump Industrial Average ($TRUMP)

For a long time now, I've had my intermediate charts marked with the projection for a large C-wave decline, and I've been wondering from whence the catalyst for such a decline might come.  Tonight, it appears Donald "The Donald Trump" Trump has been declared the next President of the United States of 'merica, and that may be as good a catalyst as any.

As Trump's victory grew more apparent, futures began tanking, largely because Trump has threatened to rename Wall Street as "TRUMP Wall Street," which made traders nervous.  Wall Street had also priced in a Clinton victory -- which was apparently worth at least 100 ES points, probably because Hillary had promised "a pantsuit in every closet," which led to a growing bubble in the overweighted pantsuit manufacturing industry, which now accounts for nearly 38% of the total market cap of the S&P 500.

Compounding Wall Street's fear is the fact that Trump has repeatedly vowed to abolish attractive hairstyles, which means that many hedge funds managers will either lose their jobs, or be forced to show up at work wearing "no less than three" dead ferrets on their heads.

(WARNING:  Rant Alert!)  First of all, let me preface this next comment by stating for the record that I, personally, did NOT vote in this election.  The candidate I liked (and also happen to know personally) had zero chance of winning, and while I applaud those people who feel it's their Red (or Blue) Blooded Patriotic American Duty to vote, I am not one of those people.

Now, that said, and my functional neutrality has been declared...

I, for one, am looking forward to the elite news media helping to "unify the country" and
"put all the bickering behind us" by doing things such as declaring Trump's victory to be the equivalent of half of America voting in favor of live televised executions of minority group members, and how the only people who voted for Trump are illiterate gun-toting morons who live in bomb-shelters and drink applesauce through straws.  Hmm... why do I feel like I've seen this movie before?  One commentator I heard tonight even went so far as to suggest that Trump was carried to victory on the backs of racial bigots, as a backlash against Obama being black.  That's the stupidest thing I've ever heard.  How can one even present that reasoning after Obama already won (and served) a SECOND term?  

Again, I assure you I had no horse in this race.  I mention all this because I've now heard variations on this basic theme twice already tonight, from two different networks -- and it bothers me on a fundamental level.  No matter who you supported, it should bother you, too.  For crying out loud, somebody needs to say SOMETHING about it.  Personally, I don't understand how the elite media can preach tolerance on one hand, while at the same time belittling and disparaging anyone who's "different from them" on the other hand.  You can't have it both ways.  You can't demand tolerance for "people who agree with you," while behaving as if you're terrified of everyone who doesn't -- in fact, fear is the very emotion that lies at the heart of virtually all intolerance.  The whole point of being tolerant is to learn to respect people who are different from you, whether you understand them or not.  Not to act fearful of them, not to try and frame them as "damaged," and not to try and ascribe nefarious motivations to them -- simply because you don't understand their motivations in the first place.  Just accept that you don't understand and leave it at that.  It doesn't make them "inferior."  Who knows, maybe it makes you inferior for not being able to grasp it all.

Anyway, now that I've assured that I'm going to get angry letters from someone out there, let's get to the charts!

There's no real change to anything -- SPX briefly cleared the level I'd noted as important resistance (2140), then fell back below it, and closed right on it, at 2139.

 INDU:

In conclusion, the simple version of everything is that bulls need the all-time-highs to cast doubt on the intermediate counts, while bears need the recent lows.  Trade safe.