A GENERATIONAL TOP IN THE MAKING by DanV on TradingView.com
24 February 2016
In my last chart around 2 years ago entitled "SP500 BEARISH OUTLOOK - CLOSE TO FORMING GENERATIONAL TOP", I suggested that a possible top could occur around 2000 - 2030 area which I believe is still within acceptable range for such long term analysis.
It appears to me that the likely topping pattern we are witnessing could be part of a very significant top formation, to qualify as "generational top". Based on my interpretation of Elliottwave Principle, the cycle that began back in 1929, probably formed a major top of wave 3 in 2000, and all the intervening price action since 2000 till August 2011 low could be contracting triangle wave 4.
If this is correct, then we might have just seen wave 5 top on 19th May 2015 high. The choppy price action could just be an early development of major bearish cycle that could last several years with possible downside target retesting the 2009 low. Should this scenario play out then it could be very devastating and at the same time offer us opportunities to benefit, if provided we are fully prepared to take advantage.
Summary:
1. Potential Rising wedge (ending diagonal) close to breaking down.
2. Have several Fib confluence.
3. Momentum divergence at several degrees.
4. May 2015 top lines up with time symmetry (see chart below).
5. Several sectors started topping from mid 2014 with the main Index grinding higher due to strength in ever reducing number of strong stock making up the S&P500.
Conclusion:
If you wish to learn why I have come to this conclusion and what can assist you in getting fully prepared, please register for a free webinar I am hosting on Saturday 27th February 2016 at the link - https://www.danv-charting.com/live-webinar.html
Warning: This is my interpretation of price action using TA approach that I consider helps me most but could be completely wrong. Therefore as always, do your own analysis for your trade requirement and ignore my views.
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