This is SP500 from 2007 until today. I often talk about waves. I believe you all know how to count waves. From the bottom of the curve Jan 2009 to the top April 2011 there are three big waves. The first wave have five smaller waves then the correction down in three waves. From that bottom there are again five smaller waves and finally a three wave extension that tells you that the big uptrend is over. Then you see a big head and shoulder formation above the line and a break of the neckline which takes us to the low in August. Then three waves uptrend and fall but not below the low so the market goes up to recent top Oct 24 and makes a three waves correction down Nov 21 and after that comes last weeks rally. My immediate feeling is that this trend will go up to resent top. However other tools tells me that will not be the case.
Above is England's FTSE and to the left Germany's DAX. Nearly the same pictures. These three markets will react the same next week and the next several years. If you know how one of them reacts in the big picture you know how the stock markets react in Europe and in the U.S. Since SP500 futures trades last and starts 8 hour earlier in the day I follow that one only. Do you think the DAX chart now will take a new chart high. No way. Then the SP500 will not either. If you think the SP500 will start a new bull market now then you also believe that Germany will. When I view the DAX my immediate reaction is that when the current uptrend ends, which will happen soon, it will go down to the low of the chart.
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