Updated: Mar 5
Well not really, but kind of if things really do spiral out of control for the traditional markets such as $DJI $SPX and $NQ. With the most recent sell off being the worst sell off since 08' in which Federal Chairman Powell said "We saw risk to the outlook of the economy and chose to act". So this Tuesday the Federal Reserve cut the U.S interest rates by half a percent in hopes to limit the economic catastrophe from the coronavirus. Although we saw an immediate positive impact to the market does this mean we can safely call a bottom for this sell off? Diving into the highest degree of charts I wanted to peer as far back as I could to really get an idea of where we are in the grand scheme of things. I needed to ensure that the current structure I was studying on the D1 chart made sense to the bigger picture. From an Elliott Wave perspective one thing stands out to me and that is I can clearly count 5 waves from the bottom of the chart. With that being said in the final wave I can also count 5 waves which is usually your sign of reversal. There is one thing that just does not add up structurally on the top of this entire structure. The move that got us to the high looked to be of the 3 wave nature. Which isn't what we look for unless it was a diagonal which it could not be. Creating this 3 wave move into the highs makes me believe we are putting in a larger degree corrective phase and we are now searching for a reason to enter the market Long.