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Saturday, March 21, 2015

Saturday, 3/21/15 update

bear (b^ar) n.  A large plantigrade carnivorous or omnivorous mammal (family Ursidae) with massive thick-furred body and short tail.  Currently thought to be almost extinct.

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A week ago it really looked like the intermediate term (and possibly long term) trend had shifted to bearish after the late February ATH's.  The drop from those ATH's into the Mar 13 low looked very much like an impulse and cut too deep in relation to the preceding uptrend to be considered as a "C" wave of a corrective structure.  However, the action this last week has brought the ES to very close to establishing new ATH's and thus invalidating the idea of a major top being in place.  In addition, the week's rally pattern is very impulsive looking, which also suggests a continuation of the move up past the late February highs.

Thus the bear count still remains on the table but has diminished in probability to maybe 1 in 10.  That count shows a double zig -zag off the Mar 13 low and will be ruled out with a print above the ES 2117.75 high of Feb 25:



The primary alternate is that Major W5 of the bull market from the 2012 lows is still in progress.  In that context the March sell off is Intermediate W2 of Major W5 with Intermediate W3 now underway.  What looks like an impulse structure in the March sell-off is counted as a double zig-zag (with some difficulty):


If we continue rallying to new ATH's another possibility opens up, and that is one where Major W3 of the bull market from 2012 is still in effect.  This alternate would have the market forming an ending diagonal Intermediate W5 of Major W3 as in the chart below:


Obviously it would also mean quite a bit more bull market yet to unfold.
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