The yellow channel represents a rollover of the linear regression if we do not break all time highs.
The top of the rollover channel was almost tapped today giving me confidence in the trade.
I will remain short until either the weekly slow-stoch re-embeds above 80 or we break an all time high.
If we get the roll over into the yellow-lined channel; then the 1970s playbook of "higher inflation and recession" will force the Fed to cut rates; spike inflation, crush the economy under said inflation which is the catalyst for crushing the SPY to new lows by October.
This will be similar to a 5-wave impulse pattern. We just completed wave 2. The 3rd wave if measured leads us to the 200day MA at 4380 by July 24th if you extend it out to project where it should be. (White dotted line).
That is an extremely reasonable expectation for a 3rd wave and the lining up with the 200day makes the trade almost too perfect.
A weak wave 4 allows for a strong wave 5 to bring us to new lows without breaking the rules of Elliot Wave theory. Wave 5 cannot be bigger than wave 3.
The top of the rollover channel was almost tapped today giving me confidence in the trade.
I will remain short until either the weekly slow-stoch re-embeds above 80 or we break an all time high.
If we get the roll over into the yellow-lined channel; then the 1970s playbook of "higher inflation and recession" will force the Fed to cut rates; spike inflation, crush the economy under said inflation which is the catalyst for crushing the SPY to new lows by October.
This will be similar to a 5-wave impulse pattern. We just completed wave 2. The 3rd wave if measured leads us to the 200day MA at 4380 by July 24th if you extend it out to project where it should be. (White dotted line).
That is an extremely reasonable expectation for a 3rd wave and the lining up with the 200day makes the trade almost too perfect.
A weak wave 4 allows for a strong wave 5 to bring us to new lows without breaking the rules of Elliot Wave theory. Wave 5 cannot be bigger than wave 3.