It wouldn’t surprise me to see stocks drift down here and make a new low, though on a diverging RSI without a new high in the VIX. We had a very swift move last week, so Elliott wave 3 should be behind us, and the next low could set us up for a 200-300 point bounce. You could also make the case that we’re already primed for one, with daily RSI oversold here.
Source: Prophet.net
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EDIT (2:45PM EST) – I like this channel better:
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On a larger scale of course I think the decline is just starting.
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Here’s how the Dow did in the last deflationary depression. Best move was to get short and stay short, since all rallies after the first big one were quick to peter out.
