Sentiment

Avi Gilburt

"THE BEST in This Business" --PSK (ElliottWaveTrader)

I Am A Long Term Bull, But . . .

For those that have followed my work for some time, you would know that I have maintained a long-term bullish bias for many years.  In fact, while many were looking for a market crash back in early 2016, we were pounding the table looking for a “global melt-up.”  Moreover, as we went into the election in 2016, we continued to pound the table with targets north of 2600SPX, when at the time we were in the 2100SPX region. 

As for how I currently view the bullish long-term perspective, I don’t think this market tops out until around the 2022/23 time frame, with the potential to rally as high as the 3800-4100SPX region within that time frame.

But, that is not the same as saying that I think the market is going directly to that region right now.

For those that understand how markets work, nothing moves in a linear fashion.  Rather, I believe that the market is fractal in nature, and view it as taking five steps forward and three steps back. 

Within that perspective, I see the market as now completing five steps forward off the December lows, which means I am looking for at least three steps back.  For this reason, I think the 2600 region is a minimum target with the strong potential to still drop towards the 2200 region before we begin that final rally into 2022/23.

Now, clearly, I can always be wrong in my assessments.  My work is based upon probabilities.  And, based upon the structures I am seeing, it would suggest that once we complete the current bout of strength and the 5-wave structure I am tracking that can point us towards the 3000 region, then 70% of the time the market would take us back down to at least the 2600SPX region. 

Yet, that means that 30% of the time, the market can surprise us and continue directly towards our 3800-4100SPX target.  And, if we see continued strength through the 3020-45SPX region, then I would likely have to side with what I now view as the lower probability path.

The next 3-4 weeks of market action should provide us further clarity regarding from where the market begins its next major rally to the 3800-4100SPX region.

Avi Gilburt, co-founder of FATRADER, is the lead moderator of the forum and covers Market Sentiment. Founder of ElliottWaveTrader, with over 4000 members, Avi is renowned for being one of the most accurate and widely read analysts on the Web.
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