It appears that we are indeed in wave three. Those who have studied EWT know that wave three is longer than wave 1. So we have further to go. On the SPX daily chart shown here we point out the end of wave 1 and wave 2. The question now is where does wave 3 end and reverse. The signs I look for is a reversal in the stochastics and in the MACD. Also the advance/decline ratio will expand. Right now it is about 2 stocks down for 1 stock up. Ultimately, the ratio will be about 20 down for 1 up. My strategy is to hold the indexes short and to prepare for the reversal. At that time I will go long for wave 4.
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