Are You Ready for 2017’s Tsunami? V

BarroMetrics Views:¬†Are You Ready for 2017’s Tsunami? V

My apologies for the break. I went to Singapore and struck probs with my notebook. Anyway, now back in HK till early July.

When we left this series, I said that I’d look at the technical picture. Fundamentally I have taken the view that we’ll see a bear begin in stocks towards end 2016, early 2017.

Figure 1 shows the 13-week Ray Wave count. It raises the possibility that we may see an earlier move down. If that is going to occur, we need to see the down move start now. It took 10 bars to form Wave V. If a top is to form now, we need to see the II-IV trendline breached in the next 6 weeks.

The alternatives are:

  1. More sideways price action, followed by a new high that holds below 2242. The likely max target is 2724 and the min is 2175. The new high is followed by acceptance below 2104,
  2. The new high accepts above 2242 and continues with another bull leg up.

Of the two, I rate scenario (1) as the greater probability.

If the bear is to start early, we’ll have a clear signal tonight if we see another strong day down.

Figure 2 show the day session of the E-mini. On Friday, it formed a traditional double distribution trend days. Pete used to say, ‘trend days are not good continuation days UNLESS it’s the start of a move’.

Let’s see what tomorrow brings.

2016-05-16_18-37-16 13w RWCount

FIGURE 1 13-w Ray Count Cash S&P

2016-05-16_18-38-22. ES Pitt DD Trend Day

FIGURE 2 ES Day Session Market Profile.