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I am counting this correction as intermediate wave 4 within a larger bull market. If that outlook is correct, the high of the year may have been seen but there could be 1-2 tests of that high over the coming weeks or months which could go a bit above that high.
The early September high is the top of primary wave 3 as I am counting it. I would now be looking for a multi-week or multi-month wave 4. Wave 5 may then be approximately equal to the length of wave one which tends to be the case when wave 3 is extended. * An alternate possibility is that wave 4 bottomed at the October low. If so wave 5 should complete by the end of the year. I am not expecting that the anticipated wave 5 to be the top of this bull market. This Elliott Wave outlook is shown graphically on the below bi-weekly chart. The Vanguard S&P500 ETF is used as a proxy for the S&P500 index. A strong move above the September high in the next few months below this months low may negate this outlook.
One of the great things about Elliott Wave is the big picture view it provides so as to help to see when to hold and when the outlook is starting to work against you. No market analysis methodology can predict the market perfectly every time.
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| S&P500 index bi-weekly chart as shown by the VOO etf. The primary wave 3 high is shown by the circled 3 in early September. (click to enlarge) |
