Back in The Channel Again

With a nod towards the well-known Aerosmith tune, and a chart we showed previously, we must note that prices are now back inside the long term channel again.

S&P500 Cash Index - Monthly Close - Back in the Channel

Even on a monthly closing basis, in linear chart mode, prices have crept back inside the channel again. This will likely be a precursor to further weakness at some point. So far, the "sell May, go away" adage is working.

Further, we note this outstanding Fibonacci relationship in the rise since the December low.

S&P500 Cash Index - Daily - Golden Section

While not precise to the exact day, the relationship is close enough to be meaningful. We were following this potential relationship when we noted the corrective action around day 55. Its significance now is that a Golden Section has been completed, and the price declines began just before the Fibonacci 89th day.

Further, we note the Fisher Transform Indicator never did break the divergence from the January high, and now has made a new low.

I will note that other Elliott Wave sites are already switching from the primary impulse counts to back-up impulse counts. And they are not being honest about their incorrect counts. We, on the other hand, have always considered this rise as corrective, and we admit again now, and have admitted earlier, we were incorrect as to the extent of the rise.  We will always try to 'level' with you about the real nature of wave counting. 

And we hope to show you some simple studies - like that above - that few others consider in their Elliott Wave work.

Have a good rest of the weekend.

TraderJoe