Big Picture Possibilities
Posted: July 28th, 2017, 4:05 pm
(1) Imagine the S&P500 (or Dow), from March 2009 to now, as having traced a 5-wave pattern up:
Wave 1 peaking in May-11.
Wave 2 bottoming in Oct-11.
Wave 3 peaking in May-15.
Wave 4 bottoming in Feb-16.
Wave 5 peaking in TBC.
(2) Now imagine a 3-wave abc correction, a normal cyclical bear market, perhaps falling 15-20% from the Wave 5 peaks, taking the S&P500 towards 2000 and the Dow towards 18000. Undoing some of the current excesses, re-establishing a wall of worry.
(3) Viewed in the big picture of a secular bull market, (1) and (2) above are themselves higher degree waves, setting the scene for a higher degree Wave 3 upwards. 3rd waves are usually the largest and most powerful wave, and part way through this bull market (probably during its own lower degree Wave 3) is where you might expect general public participation to begin, something we have seen almost nothing of since Mar-09 to-date. So, perhaps a fierce cyclical bull market lasting a decade or so, with very large rewards for those participating.
(4) & (5) Plenty of time to deal with those later!
Wave 1 peaking in May-11.
Wave 2 bottoming in Oct-11.
Wave 3 peaking in May-15.
Wave 4 bottoming in Feb-16.
Wave 5 peaking in TBC.
(2) Now imagine a 3-wave abc correction, a normal cyclical bear market, perhaps falling 15-20% from the Wave 5 peaks, taking the S&P500 towards 2000 and the Dow towards 18000. Undoing some of the current excesses, re-establishing a wall of worry.
(3) Viewed in the big picture of a secular bull market, (1) and (2) above are themselves higher degree waves, setting the scene for a higher degree Wave 3 upwards. 3rd waves are usually the largest and most powerful wave, and part way through this bull market (probably during its own lower degree Wave 3) is where you might expect general public participation to begin, something we have seen almost nothing of since Mar-09 to-date. So, perhaps a fierce cyclical bull market lasting a decade or so, with very large rewards for those participating.
(4) & (5) Plenty of time to deal with those later!