China: new bull market underway?

If it wasn’t for the quantification of waves by OEW this volatile index would look more like a commodity index than a stock index. When reviewing the entire history of the SSEC we see a series of volatile up moves followed by longer and less volatile down moves. In fact, nearly all of the bullish trends have lasted only 1-2 years, while the bearish trends have taken as long as 4 years.


After a very volatile beginning in the early 1990’s the SSEC settled into a nice 5 waves up from 1994-2001: Primary I. Then after a 4-year bear market into 2005, Primary II, the SSEC finally joined the 2002/03-2007 worldwide bull market. The early stages of Primary III, 2005-2007, were almost unnoticeable. A series of small waves setting the stage for what would become a six-fold advance in only two years. The bear market that followed, Primary IV, has been the tricky part for nearly everyone.

The key to this long term count remains the Primary I high back in 2001 at SSEC 2245. Since fourth waves cannot overlap first waves, and two of the down legs did, the only pattern that could describe this choppy 9-year activity is an expanding triangle. As long as a fourth wave triangle terminates above the first wave high the pattern is acceptable. And this is what we believe has just occurred, after tracking this pattern for a number of years.


The weekly chart displays all of Primary waves III and IV. Notice how all the up legs, Primary III, and Majors B and D, all started off with a series of non-descript small waves setting the stage for the surge that would follow. The market appears to be at a similar juncture again. If the January, 2016 low ended Primary wave IV, as we suspect, the SSEC is now setting up for a move to all time new highs in the next 1-2 years.

This is not an investment recommendation, as we do not make recommendations. We only track the waves and report the most probable path based on this analysis. We suggest everyone do their own analysis and make their own investment decisions. If you would like to track the SSEC along with us, you can find the charts by scrolling down using the following link: Best to your investing!

About tony caldaro

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17 Responses to China: new bull market underway?

  1. vivelaamo says:

    Could we get 2140 next week?

  2. wmorel says:

    Chart looks like it will downdraft shortly. The second peak and the run to it and from it look much the same as the first but of a lessor magnitude. To me Looks like we see 2000 before we see 3000. Many seem to forget, the Chinese dream is a myth based on numbers. China has created a magic kingdom but it’s all a facade. Communism is top down manipulation not bottom up structural change. Their debt problem along with excess old school capacity that will become worthless and need massive retooling will come calling with a massive swan song soon enough.
    China is like a massive ship that takes time to turn left or right and once you lose control; it crashes hard.

  3. wildmarkets says:

    China in a Bull market and US topping out? Counts will be changed!

  4. 123 abc says:

    Superb analysis Tony et OEW team. With all major Asian indices now poised as bullish, the DOW count alluding to Primary-iii is gaining traction. Current point in time is reminiscent of 2010…

  5. kvilia says:

    Thank you Tony. It is all relative at this point. Looking for another correction in US and other markets before the beginning of another bull. However as you accurately stated, should the markets break over the certain point, there will be a follow through without denial.

  6. paulmaasson says:

    Thank you very much for your analysis.
    I love these ‘special reports’ !!!

  7. torehund says:

    Tony we have waited a long time for it 🙂
    Mega basing phase to lean onto, and fuel is cheap, $ SSEC and China going for gold.

  8. fotis2 says:

    Much obliged sir.

  9. Page says:

    Thanks Tony. Outstanding analysis.

  10. pooch77 says:

    Tony impact on U.S. indices?

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