NASDAQ 100 Update: Stick save by the Bears?…

Are We Missing a Wave?

Namely, our interpretation of the EW count since the infamous October 2022 low, which is not shown, could be off by one wave degree. This means that the July ATH was not a final 5^th wave top but a 3^rd wave and that the August 5^th low was not the start of a multi-year Bear market but a larger-degree (Major) W-4. Subsequently, the index is now in its final, more significant 5^th wave: Major W-5, which is most likely morphing in an Ending Diagonal (ED).

In an ED, the 3^rd wave (red W-iii) typically targets the 1.236x Fibonacci extension of the red W-i, measured from the red W-ii low, which resides at $21500. From there, a correction, red W-iv, can target typically, but not necessarily, the 61.8-76.% Fib-extension at $19940-20300 before the red W-v kicks in, to ideally the 161.8-176.4% Fib-extension at $22460-820. This path is contingent on holding above at least the October 1 low, especially the September 6 low.

The bottom line is that yesterday, the Bears broke the NDX’s price below the 1^st (blue) warning level for the Bulls and are now sitting at the 2^nd level. Thus, they have a shot at hammering out a multi-year top, but it requires a break below at least the October 1 low.

Until then, all calls for “the top is in” are, although maybe after the fact correct, still technically premature. Especially since the index is still in a 100% Bullish uptrend, as defined in our previous update. A breakout above the recent July ATH will negate those plans, and we will look for $21500+ before the following correction should announce itself.