What We Can Expect This Year In The Market

This latest Wave 5 will be equal to Wave 1 of the latest move since July 2010 when we top DJI 12,000. We will have then also completed a 5 count wave advance since March 2009. We can expect a sharp correction after that level is reached, but remember Wave 5's can extend further than the "rule of wave equality" if the market is extremely strong, which doesn't appear to be the case here. At best the correction will be severe but short and the market will continue the advance. At worse the current correction will be an extended B Wave and the correction since March 2009 will be a Zigzag 5-3-5 (both A and C Waves contain 5 counts) which will go sideways with the next C Wave making a slightly higher high above DJI 12,000. This may take all this year to complete. It is always a red flag when too many start agreeing with you on a market direction and must be taken as a contrary indicator.