S&P 500 Target setting (Elliot Wave, Fib, VPVR)

2020年4月21日

This post isn't going to make the bearish case, I have done that enough in other posts, this is doing some target setting using basic Elliot Wave theory (this post also assumes you most of the basics). One basic way of predicting some sort of pull back or correction (2,4,A, or C Wave) is to see when a trend line that was support turn into resistance. Now Elliot waves are much like humans, we have the capacity to be infinitely dense, but dad jokes aside, I am looking for a downside target to be set as I see the blue trendline, which as multi-decade long history of switching from support to resistance and back, appears to be re-asserting itself as resistance.

We have a lot of fib levels to go over, so lets take them one by one.

• The Blue Fib is a retracement of the downtrend. This means that the downtrend has retraced 0.618 of the initial impulse down
  
• The Orange Fib is an extension of my theoretical A Wave, but taken from the peak of the B wave using the commonly occurring fib extensions.
  
• The Red Fib Extension is a 100% extension of the B Wave, from the height of the B wave. This predicts a double bottom or a intermediate target between the Orange 1 and 1.618 levels.
  

To back up the bearish nature of this down trend is the MACD and the 4h chart. The hidden bearish divergence (lower high on the price, higher high on the indicator) is so painfully obvious I am not even going to chart it. Nor am I charting the bearish rising wedge, which also should be painfully obvious to anyone with some experience charting.


The VPVR seems to confirm the orange 1.618 fib extension at about 1425 and it confirms price action testing the previous high at ~2100 that was set in 2015-2016. This isn't a fib-ration that was discovered in this analysis but I expect with some research we could find it. If one of y'all could do that for me, it would be great.


The VPVR shows the price action bounced off of the lower value are. We are going to be in a legit bear market of almost unimaginable proportions if that breaks as support. The Most Horrible Target of the S&P 500 going sub $500 will easily be on the table then.