Good evening to you folks, and the Lord’s blessings to you all tonight.

John P. Hussman, Ph.D.

Same lesson holds on the downside – internals don’t define limits or “catch” short-term moves.

They gauge uniform shifts in speculation/risk-aversion.

As with valuations and internals in 2000-02 & 2007-09, “I missed my chance to get out” can abruptly replace “I missed the lows.”

EURUSD.

EURUSD 1hr.

EURUSD 4hr.

EURUSD daily.

We are effectively looking at a triple top in EURUSD today.
The price has failed to make any move above that 1.0277 top at wave ‘a’ today.
And with that,
the main count gets a vote in its favor today.
If that count is correct,
then we should see a sharp move lower to begin wave (v) from here.
Wave ‘i’ of (v) should fall and break the wave ‘b’ low at 1.0094 with ease.

the alternate count has changed slightly this evening.
This action can also be viewed as an ongoing correction in wave (ii).
this count will allow for a de3cline to a higher low above 0.9952 again in wave ‘c’ of (ii).

Tomorrow;
watch for wave ‘c’ to show signs of a top and reversal.
Wave ‘i’ of (v) should fall into the wave ‘b’ low by tomorrow evening.

the high at 1.0358 should hold.

GBPUSD

GBPUSD 1hr.

GBPUSD 4hr.

GBPUSD daily.

the count is cable is not ideal I will grant that for sure.
But we still have that very prominent three wave rally evident off the recent lows.
I am going to stick with the main count for the next few sessions,
and if we do not see a rev ersal into wave ‘i’ of (v) by midweek,
then I will switch the count towards a bullish pattern off that 1.1890 low.

Tomorrow;
Watch for wave ‘i’ of (v) to fall again and break 1.2063 to signal a reversal pattern is building.

USDJPY.

USDJPY 1hr.

USDJPY 4hr.

USDJPY daily.

USDJPY has now reached that initial target level for wave ‘A’ at 131.48.
This level marks the low of the previous fourth wave,
and I expect we will see support build around this area over the coming few sessions.

I am looking for a three wave rally over the coming week in wave ‘B’ of (4).
The initial target for that rally is in the area of the wave [a] low at 135.50.

The alternate idea for wave ‘A’ down involves a five wave pattern off the top.
So if we see a continued decline this week,
then I will switch to that idea for wave ‘A’.

Tomorrow;
Wave (v) of [c] of ‘A’ has an internal five wave pattern complete at todays lows.
Watch for wave (v) of [c] to complete and for a possible reversal higher to begin tomorrow evening.

DOW JONES.

DOW 1hr.

DOW 4hr

DOW daily.

Todays trade was flat and lifeless overall.
The slow action does add to the idea that momentum has topped and reversed off that previous rally in wave ‘c’.
But so far we do not have anything to work with to signal this correction in wave (ii) is complete.
I am looking for that initial wave ‘i’ decline to retrace all of the rally in wave ‘c’.
That will pretty much confirm the larger bearish count for wave (iii) of [iii] of ‘3’.
So the stakes are pretty high here.
And that big third of a third decline will be a real wealth killer.
The Dow could fall into the 2500 handle again if that degree of a third wave decline does kick off.

Tomorrow;
In the short term, the idea remains the same.

We have a three wave correction higher now in place in wave (ii).
All that is needed now is a small impulsive wave off the high to begin in wave ‘1’
and break below the 31800 wave ‘4’ low again.
This will be the initial sign that the market is turning into wave ‘i’ of (iii) of [iii].

GOLD

GOLD 1hr.

GOLD 4hr.

GOLD daily.

Gold is pretty flat also today.
Wave ‘c’ of (iv) is not complete just yet it seems.
But any upside momentum hat was present last week has completely disappeared now.

I suspect we will see a similar type pattern in gold off the high as I am looking for in the stock market.
Wave ‘i’ of (v) is expected to fall back below the wave ‘b’ low at 1710 again.
And that will confirm the larger pattern here.

The main alternate pattern that I am looking at for the hourly chart here is a bullish impulsive wave ongoing off the lows at 1680.
IF that pattern is correct,
then we will see a correction in a fourth wave this week,
followed by a rally into wave ‘v’ possibly next week.

Tomorrow;
Watch for wave ‘i’ of (v) to begin and fall back below 1710 again at wave ‘b’ over the coming days.
A break of that low will rule out the alternate count completely.

CRUDE OIL.

CRUDE OIL 1hr.

CRUDE OIL 4hr.

CRUDE OIL daily.

Well todays decline did break the previous wave wave [b] low at 92.53 for a moment at least.
There has been very little reaction higher off that level,
so it is possible that wave (iv) of [i] is now correcting sideways as shown.
This correction should be followed by another drop in wave (v) towards the 88.00 handle again to complete wave [v] this week.

I am looking at that alternate for wave ‘2’ again tonight.
If the price fails to break to a new low this week,
then I will switch to the alternate wave [b] of ‘2’ shown in red.
And then we can expect a rally next week into wave [c] of ‘2’ as shown.

Tomorrow;
The main count does deserve more time to complete wave [i] of ‘3’ because of the sharp decline today.
So watch for wave (iv) and (v) to complete five waves down later this week.

S&P 500.

S&P 500 1hr

S&P 500 4hr

S&P 500 daily.

The S&P is tracking in the very same pattern as the DOW right now.
So I am almost lost for words tonight,
as I will just be repeating myself!

I have changed the main count on the hourly chart this evening,
but that does not change the overall idea here one iota.
this is a correction higher in wave (ii),
and it should be followed by a sharp acceleration lower into wave (iii) in short order.

so far the correction in wave (ii) has retraced close to the 38% Fib level at 4170,
and just above that is the previous fourth wave high at 4200.

The upside action is faltering now in wave ‘5’ of ‘c’.
The price has not turned lower yet obviously,
but I think we can expect that move to happen this week if this pattern proves correct.

Tomorrow;
I am still marking that wave ‘4’ low at 3900 as the initial signal level that wave ‘i’ of (iii) is underway.
Lets see if we get a turn lower to begin that wave ‘1’ tomorrow.

SILVER.

SILVER 1hr

SILVER 4hr.

SILVER daily.

No sign of a reversal in silver today.
It seems the markets are asleep today apart from crude oil!
But even so,
I am looking for that reversal pattern to begin this week in wave (i) of [v] as shown.
And wave (i) is expected to fall back into the 18.00 handle again in the range of that triangle wave (b).

As with most of the patterns this evening,
I am waiting for that initial move off the highs to signal the next leg down is underway.

Tomorrow;
Watch for wave (i) of [v] to finally drop off the current highs.
A break into the top of the triangle range at 19.09 again will be enough to signal wave (i) of [v] is underway.