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Executive Summary

On Monday, the market gapped up 12.5p to SPX2475, and rallied another 12.5p in the cash market. On Tuesday, the

market gapped up another 5p, but remained in a tight <10p range for the remainder of the week, with only a 6.92p

drop on Thursday morning. The fact that there’s not been a >10p pullback since the SPX2459 low makes this rally hard

to count, as under a normal impulse price would have dropped from the 1.618x extension (SPX2497) to the 100%

extension (SPX2483) before rallying to the 1.764-2.00x extensions (SPX2502-2508), for a typical 3rd, 4th and 5th wave;

respectively.

I therefore have to keep 3 counts, with the first two pointing to the same upside target (SPX2520) and the same

downside target (SPX2400) the third has the market already rallying to SPX2600 for an extend major-3;

• Ending Diagonal 5th wave for intermediate 5, targeting up to SPX2520 +/-5 for an atypical major-3 extension

of 1.764x 1 (SPX2522.47).

• Irregular intermediate-b wave of major 4 targeting ideally SPX2510, assuming SPX2484 was major-4 and minor

c = minor-a. But, in the case SPX2491 was major-3 then it can extend up to SPX2519, which thus coincides

with the maximum target of this EDT.

• Nested i, ii, 1, 2 count, which I will need to see blast off through 2510 to make it my primary count: first target

zone (orange micro-3 in figure-1) is SPX2518-2530. This count will be invalidated by a drop below SPX2480

(micro-1) at any time going forward. This count is also shown on the DOW below as an illustration.

All systems remain on a buy, and all point, like my count to higher prices. The SPX2502-2510 target zone is ideal for

the market to top out for the first two scenarios, but it can go higher.

The latest NAAIM (National Association of Active Investment Managers; smart money) exposure data, shows money

managers have been pulling back market exposure since the beginning of this summer. Contrary, the AAII (American

Association of Individual Investors; dumb money) sentiment survey spiked 12% to 41% Bulls and dropped 14% to 22%

Bears. In addition, the next two weeks and especially the last week of September are seasonally rather weak.

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Trading Performance Update with North Post Partners, LLC

NPP provides neither a boom, nor a bust. Just consistency. Ended the week up another quarter percent, trailing the

markets, but we believe in small consistent moves as there are old traders and bold traders, but no old bold traders…

It is also because we are currently risk averse given the market is not giving clear signals and the last 4 of the past 5

trading days saw a “whopping” 9.86p range on the S&P… Good luck with that (i.e. even the best ETF -SPXL- gives you

only 0.012%).

Please contact me or Rus Chao directly (rustinchao@gmail.com) for more information. Joining NPP is absolutely free,

and we charge no service or maintenance fees.

Please follow NPP on TWTR: @NPPtrades (all intra-day trades are provided there in real time)

Please bookmark NPP’s website: http://northpostpartners.com/ (weekly digest/trading plans are posted there)

*It should not be assumed that future performance will always be guaranteed and/or profitable. Nor will future performance necessarily equal past

performance or past performance trends. All trading and investment decisions are the sole responsibility of NPP. Joining NPP is free, but does not

exclude commission costs, and other possible charges.

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Elliot Wave Updates

In last weekend’s update, I noted “…, price found support at the green uptrend line on Friday [blue arrow Figure 1], and

now needs to stay above that line to allow for more upside. Above SPX2470 then opens the door for SPX2480 and

above SPX2480 opens the door for the alternate bullish count of an Ending Diagonal (EDT) 5th wave ... to ~SPX2500.”

Although there was of course also an alternate (a drop lower), we got exactly that as the market gapped up on Monday

12.5p to SPX2475, and rallied another 12.5p in the cash market. On Tuesday, the market gapped up another 5p and

remained in a tight 10p range for the remainder of the week, with only a 6.92p drop on Thursday morning. The fact

that there’s not been a >10p pullback since the SPX2459 low makes this rally hard to count, as under a normal impulse

price would have dropped from the 1.618x extension (SPX2497) to the 100% extension (SPX2483) before rallying to

the 1.764-2.00x extensions (SPX2502-2508), for a typical 3rd, 4th and 5th wave; respectively (see blue “iii?”, “iv?” and

orange target zone square). Of course, this wave can extend, but I can’t quantify it as there’s no subdivision yet.

Figure 1. SPX 1-min chart. No >10p pullback the whole week. Support at trendlines.

SPX 60-min chart: Intermediate-b wave scenario

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In addition, the rally off the August low SPX2417 has been overlapping (2455, 2417, 2480, 2446) and it still can be the

nested 1, 2 count as shown in Figure 1, but it hasn't been a standard impulse structure and I will need to see blast off

through 2510 to make it my primary count. Thus, we’re still stuck with the 3 counts I presented the past week until the

market disproves one or the other:

• Ending Diagonal 5th wave for intermediate 5, targeting up to SPX2520 +/-5 for an atypical major-3 extension

of 1.764x 1 (SPX2522.47).

• Irregular intermediate-b wave of major 4 targeting ideally SPX2510, assuming SPX2484 was major-4 and minor

c = minor-a. But, in the case SPX2491 was major-3 then it can extend up to SPX2519, which thus coincides

with the maximum target of this EDT.

• Nested i, ii, 1, 2 count, which I will need to see blast off through 2510 to make it my primary count: first target

zone (orange micro-3 in figure-1) is 2518-2530. This count will be invalidated by a drop below SPX2480 (micro-

1) at any time going forward.

Please remember, the next larger upside target I foresee is SPX2600 and although I still think we’ll get a bigger pullback

before that rally ensues, it is possible we may be on our way already (nested 1,2 count) and therefore shorting a Bull

market should not be done by the faint of heart and with prudent position sizing and profit taking as in a Bull surprise

always come to the upside. However, since it’s a market of stocks and not a “stock market” I see many stocks that all

need a larger pullback at this moment, supporting the major wave-4 I’ve been looking for.

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Market Analyses

On the S&P daily chart all Technical Indicators are pointing up and are on buy signals, money is flowing back into the

market (MFI pointing up) and price is back above all its SMA (from 5d to 200d), which are all pointing up, as well as

back above its trendlines. All Bullish. Period. Longer term there’s negative divergence in money flow and the MACD,

but that hasn’t kicked in yet. A red day on Monday will set up negative divergence on the RSI5.

Figure 3. SPX daily TI chart: All TIs pointing up price above 20d and 50d and back above most trend lines.

i

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The weekly chart (intermediate to long term perspective) of the S&P remains bullish with all SMAs pointing up, and

bullishly stacked. Price is still in the black uptrend channel, and broke this week out above the SPX2485 level. Hence,

also here: up is up. The weekly A.I. non-ideal buy signal remains, but the MACD is still on a sell. Money flow is also

decreasing on this longer-term time frame than the daily chart shows; money is still not pouring into the market at

current levels as much as it did when the S&P was at for example SPX2300. This fits with the most recent NAAIM

(National Association of Active Investment Managers; smart money) exposure data, which shows money managers

have been pulling back market exposure since the beginning of this summer. Contrary, the AAII (American Association

of Individual Investors; dumb money) sentiment survey spiked 12% to 41% Bulls and dropped 14% to 22% Bears. In

addition, the next two weeks and especially the last week of September are seasonally rather weak.

Figure 4: S&P500 weekly TI chart: non-ideal A.I buy signal, but MACD still on a sell. Longer term uptrend per SMAs.

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I want to continue to present my analyses and wave-count of the NASDAQ to try to better confirm my view of the

market. I redid my wave count entirely, and tried several different counts also using the NDX. In the end, I continue to

find the wave count shown below, with price now in intermediate-v of major-3. Please note that a) each larger

correction lasted the same number of days: 18-19 days; b) green minor-1 was an EDT, and has the same pattern as

what we can observe for the S&P currently off the SPX2417 low: wave-c longer than wave-a, and wave-e longer than

wave-c. That said, there’s negative divergence on the RSI5, another initial A.I. sell signal, whereas the short-term wave-

count off the August low can be counted as completed. Green minor wave 3 and 4 hit the 1.62x and 0.76x extensions

as they should, and the 2.00x extension for wave-5 is at $6490 +/-5. A few more scribbles to this target region would

be ideal, but not necessary.

Figure 5: NASDAQ daily TI chart: negative divergences, another initial A.I. sell signal. But still in uptrend.

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The weekly chart below shows my Elliot Wave count for the NASDAQ simple based on weekly candles. Red candles go

with correction, while white with impulses. So far, the weekly count fits the daily count. Note that price is above the

20-200w SMAs (longer term uptrend) and above the purple uptrend line, as well as inside the green uptrend channel.

But the RSI5, MACD and OBV continue to sport negative divergence.

Figure 6: NASDAQ weekly TI chart: negative divergences everywhere, but still in longer term uptrend

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Market breadth & Simple Moving Averages Charts

The SPXSI (Summation Index for the S&P500, derived from the McClellan Oscillator for S&P500 (SPXMO)) remains on

a buy signal as breadth readings remain positive and ended at +40 on Friday, up 6p from Thursday and thus confirming

Friday’s higher close. Thus, we should expect higher prices going forward. Note, the NDX-MO ended on Friday at +12,

up 12p from Thursday. This is not a bullish level, rather that of a “final wave”.

Figure 7. SPXSI remains on buy, breadth moderately strong.

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Both the long term and short-term simple moving averages charts are 100% Bullish. The former has been 100%

Bullish since late-September last year, whereas the latter only turned 100% Bullish by the middle of this week. For

trend followers among us, you know what this means: higher prices can be expected going forward.

Figure 7. Long Term Simple Moving Averages: 100% Bullish. Short term Simple Moving Averages: 100% Bullish

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Fib-based Trading Interval Turn dates & Remaining Bradley Turn Dates for 2017

The September 4 turn date only market a quick drop. It was right on que, but didn’t give the magnitude initially

expected. This is the issue with turn dates: one never knows the actual strength of the turn. Our next turn is not until

September 26.

October 7 (48/100 Middle Terms Power)

December 3 (23/100 Bradley Siderograph Power)

December 6 (100/100 Long Terms Power)

ALOHA

Soul, Ph.D.

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