$SPY - CONTRARIAN VIEW -
Added 2025-04-04 16:20:50 +0000 UTCOK I need to share this.
This is the contrarian view on the market.
The main reason I am sharing this is that we have a 3 wave pull back since the Top in Feb.
Wave A typically has 5 waves in it, but I don't see 5 waves so far, I see 3.
There is one other scenario where 3 waves is allowed and that is an WXY pull back which has 3 waves in it but it is not common, HOWEVER, it did happen in 2022.
So, a 3 wave pull back holding on the 0.38 Fib is typically found for Wave 4
I would be doing you all a disservice if I ignored this and it is also a reason why I have not been selling anything during this whole pull back since Feb.
The pull back since FEB has been record breaking fast and has put the market in a very oversold position, this can align with Wave B but companies are still strong....if the tariffs continue to be implemented then the strength of the companies will fade, so the longer the tariffs stay in place, the more damage they will do and ultimately complete the ABC correction we have called for.
But if Trump can sort this tariff mess quickly then the market could roar back. For this reason, I am going to take advantage of a potential Wave B bounce, because if tariffs end quickly, we could see this scenario above play out and there is no rejection at the Wave B rejection range
This is food for thought.
Comments
Most of the corrections had 3 waves and lasted 2-3 months. With one exception the third wave was 1.618 of the first one, and the correction found support on a fib retracement level. The current correction completes 2 months this friday 18 April, consists of 3 waves prominent on the 30 min chart with the third wave being 1.618 of the first. This correction is a 0.5 retrace of the move from the Oct 22 bottom until the 19 Feb 25 Top for both the QQQ and SPY. There was a minor squiggle which I consider as part of wave 2 which one could chart as a descending triangle.
INDY
2025-04-14 13:52:11 +0000 UTCDear CAP, would be plausible as a scenario an expanded flat correction with B wave going beyond wave A onset, thus hitting the "contrarian" target of 750 SPY ?
Magopool
2025-04-08 13:01:33 +0000 UTCEXACTLY! If looking in the 4 hour timeframe we are in wave 3 of C. After completion either it's a W and we're going for an X OR correction is complete and we go for wave 5.
Florian
2025-04-06 06:47:52 +0000 UTCI have the same question as well
Kad
2025-04-05 11:43:13 +0000 UTCSquare on my mind 😂
Gareth Neary
2025-04-05 11:35:16 +0000 UTCOn the 4 hour you can make for these 3 waves to be 5-3-5 (with another low Monday) which would be a proper wave W down of a double zig zag correction WXY (just noting that I think you mean a WXY correction (no such wave sequence as XYZ). I agree though small chance it’s a single zig zag so play the bounce and find out
Byron Tanigawa
2025-04-05 10:30:03 +0000 UTC@Cap. I see what you are saying with the first wave down A. I agree, only see 1 wave on this 1D timeframe. But if shortened to 1 or 2 hours, more waves appear, possibly even 5 of them depending on how counted. Does that make any difference?
G4Golf
2025-04-05 09:54:56 +0000 UTCUnless there are special rules for WXYs, don't see why it cannot go to between 382 and 500.
G4Golf
2025-04-05 09:51:25 +0000 UTCCap covering all grounds 🙌🏻
Chris H
2025-04-05 06:02:27 +0000 UTCCap please look my opinion in chat group: Ask questions
Dante
2025-04-04 23:27:56 +0000 UTCI'm thinking Trump might hold on until Powell starts cutting.. let's hope not
Faisal S
2025-04-04 19:17:04 +0000 UTCWow it did touch down to .382 ($506)
safoo
2025-04-04 18:53:16 +0000 UTCYes thank you. I ask about this scenario
Dante
2025-04-04 18:45:33 +0000 UTCSPY at 506 level now
Sum
2025-04-04 18:41:56 +0000 UTCI think scenario makes sense!!
Baktash Azizi
2025-04-04 18:35:39 +0000 UTCWhat is the current assessment if the EU imposes tariffs on tech companies? This could change everything or could this be the trigger for wave C
Jaschy
2025-04-04 18:35:01 +0000 UTCAll clear thanks. You also answered my question in the related chat
Magopool
2025-04-04 18:29:49 +0000 UTCThat's the thing - no one knows whether this is a correction or bear market yet, while painful still too early to tell. Dca into quality + undervalued positions is the name of the game.
JG
2025-04-04 18:22:38 +0000 UTCThis view is similar to Jeese's view.. https://x.com/Micro2Macr0/status/1906505418949452162
Ilia$
2025-04-04 18:20:19 +0000 UTCBc the waves are still unfolding. It takes time. He can’t predict the future
Brian
2025-04-04 17:51:51 +0000 UTCthe David Hunter View
Matt
2025-04-04 17:50:11 +0000 UTCAm I correct in saying we should either see 3 waves up to our B target (bear scenario) or 5 waves up to start sub wave 1 in this potential wave 5 (bull scenario)?
Jordan Johnson
2025-04-04 17:32:40 +0000 UTCAnd would our new wave up potentially go to ATH in the spy?
Nigel
2025-04-04 17:30:26 +0000 UTCWould a "quick Trump correction" remove the need / expectation for a more "expected" ABC correction which we were expecting on the assumption we were preciously near the top of wave 5?
Nigel
2025-04-04 17:10:11 +0000 UTCLet’s go melt up!!!
Scott Williams
2025-04-04 17:03:30 +0000 UTCThanks Cap. If you only see 3 waves why we were saying that we are in wave 5 in the last months?
Andrea Zani
2025-04-04 16:55:15 +0000 UTCWith the pace of decline we could potentially hit .382 ($506) by today's close or early next week (to .382 or even to .5 ; notice .5 is ~ 2021 peak). If this plays out, how quick do you anticipate the recovery, ie to wave 5 target? It might mirror Covid recovery?
Sum
2025-04-04 16:54:37 +0000 UTCCould this be the same scenario for AMZN?
Alvaro VG
2025-04-04 16:50:40 +0000 UTCI think too many people called top weeks ago and too many people called bottom now for this to truly be the cycle top. Just my pov. Less people get it right than we’re seeing now.
Giorgio
2025-04-04 16:47:34 +0000 UTCSo we might see more downside to $506 ?
Dhairya Ratti
2025-04-04 16:42:57 +0000 UTCmy highest probability scenario would be a consolidation and let SMAs/EMAs get closer together before another leg up. this can take many months though
Julian
2025-04-04 16:42:39 +0000 UTCgood job. always important to be prepared for anything
Julian
2025-04-04 16:41:50 +0000 UTCHow does Powell's discussion today influence this? I'd imagine his resistance to rate cuts and a wait and see approach (which I personally agree with) is more likely to be bearish than bullish near-term, right?
Taylor D
2025-04-04 16:38:55 +0000 UTCI do see NAS S&P and DOW all in Wave 4 right now. So wave 5 would give us the Melt Up across the board before we enter recession and bear market time.
Lennart
2025-04-04 16:38:36 +0000 UTCCap could go Wave Z as far as the 0,5 fib to complete Wave 4?
Rob
2025-04-04 16:36:27 +0000 UTCThanks for sharing Cap, how would then the possible Y and Z waves look like over the upcoming months, if this pullback from FEB till today remains as a 3 Wave (being the X) ?
Kad
2025-04-04 16:33:39 +0000 UTCCan we get list of best stocks to buy for wave B ? Would that be in watchlist ?
manjunath
2025-04-04 16:33:02 +0000 UTCTrying to learn fast here....😊 So when you say "take advantage of a potential Wabe B bounce" how will you distinguish between the opportunity to buy or sell? Is this solely linked to Trump sorting out the tariff mess? Namely, Trump sorts it out, you buy. Still in a mess, you sell? Thanks!
MCAL
2025-04-04 16:32:46 +0000 UTCI wrote about this scenario this morning without the technical analysis and knowledge. But imagine ppl start offloading capital thinking the end of wave B is close, only to then see it go much higher and then fomo and start buying at much higher levels, which of course will keep the rally going higher and higher.
Daniel E (Bullish)
2025-04-04 16:32:42 +0000 UTCCap vibing with Tom Lee. Love it!
LD
2025-04-04 16:31:34 +0000 UTCWith the market moving so aggressively, how many times do we need to test SPY 510 level before we feel support is in Capt?
Tony Li
2025-04-04 16:31:31 +0000 UTCInteresting
Dom
2025-04-04 16:30:55 +0000 UTCDepends on the situation/ sentiment when it arrives Dayum. I’m sure cap will share more about confirmation in these two scenarios.
Collin
2025-04-04 16:28:48 +0000 UTCWait for rejection
sahilpreet Singh
2025-04-04 16:28:18 +0000 UTCwow
MJ
2025-04-04 16:27:27 +0000 UTCso exciting!
Paul
2025-04-04 16:26:53 +0000 UTCCrazy. This is black magic.
Shayanak Kundu
2025-04-04 16:25:48 +0000 UTCPersonally I like this one more lol. Thanks for the second view cap. It’s all tariffs-tariffs and if orange man says no tariffs no tariffs, we could be looking at melt up.
sahilpreet Singh
2025-04-04 16:24:39 +0000 UTCNow in dilemma as when the wave B hits to sell or assume it's wave 5 😅
Dayum Son
2025-04-04 16:22:53 +0000 UTC
