US Stocks are Now in the Bullish Season

Nov 2, 2019

My 10/26/19 SPX post noted to cover shorts if the SPX broke above important resistance at 3028 which it has and we are now entering the bullish season. November is statistically the most bullish month for the SPX. Based upon the longer term wave count and evidence from the Momentum dimension the best SPX wave count from the December 2018 bottom is that of a developing Ending Diagonal Triangle (EDT). Normally this structure has a deep retracement of the first wave, in this supposed EDT the retracement was shallow. Third waves of EDT's are almost always shorter than wave one's. Based upon the rising trend line and Fib calculations I have a possible top for wave (3) in the SPX 3125 to 3150 area sometime in December. CAUTION - third waves only need to exceed the termination point of the first wave to be complete. Also EDT's fourth waves almost always retrace into the area of the first wave. Therefore wave (3) could now be complete. Currently it is not a good position to go long.

The next few weeks could be very difficult for both bulls and bears. Holding cash IS HOLDING A POSITION. You don't need to trade all the time.

For those of you interested in learning more about EDT's read chapter one of "Elliott Wave Principle" Because they are so unique, EDT's are one of the least confusing patterns.

Mark