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Aug 7th, 2011: Can The Bull Market Live On?

Posted by pugsma on August 7, 2011

12:00 pm EST:  Well thanks to long-time subscriber Jacksoo, I have been thinking (dreaming) about E-wave all night.  How can the 2+ year bull market count live on?  I woke up this morning with an epiphany.  What if P1 ended at 956 in June of 2009 and not at 1220 in April 2011?  What would that mean for the bull market count and what would the bull channel look like?

Well guess what; it looks GREAT !!!   See the 2-day chart below.

Here is the new proposed Primary Wave Chart for Cycle 1 of Super Cycle V off the Super Cycle IV bottom of 667 in March 2009:

  • P1: 667 to 956 = 289 points.
  • P2: 956 to 869 = 87 points (30.1% retracement of P1)
  • P3: 869 to 1371 = 502 points (1.74 times the length of P1 or just over the ideal 1.62 times P1)
  • P4: 1371 to ??? (1168) = 203 points (40.4% retrace of P3 or just over the ideal 38.2% target of 1179)
  • P5: 1168 to ??? (1457) = 289 points (Ideal P5=P1 target)

In this new revised bull market count, the length of P3 is just over 1.62 *P1 and that is very satisfying as I never liked P3 being shorter than P1 in my old count.  And the P4 drop to 1168 on Friday, Aug 5th hit a perfect parallel bull channel drawn off the P2 low of 869.   If the P4 1168 low can hold, then this counts looks VERY promising.  The ideal P5 target would be 1457, where P5=P1, sometime in 2012.  This count would also remain valid for a P4 drop all the way down to the P1 high of 956.   So 1168 does not have to hold, but will channel very well if it does hold as the P4 low.  Finally the extreme oversold conditions on the oscillators (not seen since Oct 2008 and March 2009) could help propel this new bull count to new highs above 1371.

SP-500 2-Day Chart (8-7-11):

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