I’ve been up since about 3:30 looking at charts and doing a deep dive and here’s what I’ve found. I’m starting with a look at the way over bought Nasdaq. I have two wave count options for the Nasdaq. Both counts have the Nasdaq in intermediate wave (5) of primary wave [1]. The blue count seems to be backed up best my the NASI and NAAD charts that I’ll post down below. The blue count is that the Nasdaq is in minor wave 3 of (5), which is subdividing into five minute waves and it might be in [iii] of 3 at this time. The red count is that the COMPQ is forming an ending diagonal. Since minor wave 5 must be shorter than minor wave 3, this count is on a short leash and will be quickly differentiated from the blue count in the coming days.

While the daily chart below shows some mounting negative divergence that we must respect, the NASI and NAAD charts down below sugggest the top is still down the road a bit.

The NASI renko chart below has been a great leading indicator. The COMPQ price is the shaded area, the vertical red lines mark previous tops. As you can see, I have developed my indicators to be leading not trailing and we almost always see negative divergence and roll over of indicators from over bought to over sold ahead of price decline.

The Nasdaq Advance – Decline is also a nice leading indicator and historically builds negative divergence ahead of price. As you can see from both the NASI and NAAD, we should see a bit more upside before “the top” in the Nasdaq, perhaps more in line with the blue count.

In conclusion, we are nearing the top of an unprecedented run for the Nasdaq and a much needed cooling off period appears to be in the relatively near future. The blue count shown up top appears to be better supported than a top in the next couple of days. Perhaps after a bit of a Santa rally we see the top before the end of the year or just into 2021. As always, this is not financial advise. Everyone should seek the advise of their financial planner before investing a single dime in these crazy markets.