Interestingly, many analysts are finally starting to look downwards. Last week many the same analysts were looking upwards. The issue with Elliot wave analysis is that it is so often missing a wave. One most often finds out a wave was not missing when their trading account is lower by a few percentage points. We would like to suggest, for those looking for insightful Elliot wave analysis that most often does not fall into the missing wave trap - check out pretzelcharts.com - some serious wave genius activity going on with Jason over there.
Below is a probability analysis that we have been posting, updated to today. No probabilities or plots have changed over the last weeks or in fact for months. We are now at the point where directional shifts are starting to turn. There may be some noise around the very short-term. However, risks start to skew upwards and have the capacity to be very stressful for bears if they want. This is a high-stress moment for traders, investors and bull/bears. However, the edge has to go to the bulls into early September based on probabilities. There is a pivotal shift that seems to take place around the 21st of September from which a 5 to 6-week straight decline has high probabilities. Either the week of September 5th is the high of a bounce attempt, or the week of September 21st is. This can be a lower high or a higher high for the bounce attempt if it materializes. There is a slight edge for this being a lower high for a bounce attempt for the US markets and a more pronounced high for EU market such as DAX and Eurostoxx.
It is easy to count downward Elliot-wave impulses, but it is healthiest to look to trade high-probabilities at the edges and to be very careful. In fact, we suggested taking some R/R time for the next week in the "Lounge" today and to await the high R/R potential that appears to be coming in early September. Psychological preparedness is a big deal. We were focused on booking short exposure today...however, more chop is a highly draining market construct that can damage psychological preparedness. The most important aspect of trading is NOT knowing when to trade - but when not to trade. This is something very easy to forget. A smart trader lets the market do the work for them and waits patiently while other follow their opinions, impulses, and compulsions.