(Editor's Note: now that other folks are contributing to Slope, I'm going to put a "By-Line" in the subject to make it more clear that it was written by someone else; far too many people have been thanking me for the hard work of others, and I'd also like to clarify whose opinion belongs to whom – Tim).

When an oscillation is rolling with the primary trend it takes some time to turn things around. The sectors, one by one, fail to make higher highs, then stall, and then begin to decline as their time arises. Financials, Energy, Utilities, and Transports have all shown non-conformances in the past five days. NASDAQ and Russell 2000 have been quite sluggish. Today’s high at 10:45 am EST was strongly repulsed.

This is when violence ensues – bringing all sectors and markets back into alignment.

( Please click on the chart for a sharper image.)

The Impulse Wave up has extended to 5 + 4 = 9 waves. The final subminuette wave has truncated. The channels on SPX and NASDAQ, while quite different in character and timing, have both broken down. With counts at or near completion a correction is here. We cannot say with much confidence how far the correction will take us. We can say with confidence that all the characteristics of a decline of Minor or Minute Degree have fallen into place and declines of this degree take days to complete.

Thanks to Tim Knight and best regards to my fellow Slopers!  - - Pat McNeill

This morning I read Elliott Wave International's Short-Term Update, published yesterday afternoon, and I thought I'd share a couple of charts of interest. (Note: I am respectful of the proprietary nature of this work, and I have permission from EWI to republish charts from time to time, but you'll need to click on the banner ad on the right column to check out all their wares.)

The first shows the perverse relationship sentiment has with stocks. In early March, when stocks were a ridiculous bargain and multi-thousand percentage gains were just waiting to be plucked, the sentiment reading was an unheard-of 2% bulls.

Now, however, with stocks at (in my opinion) insanely-overpriced levels, and with all those multi-thousand percent gains already part of financial history, people are ga-ga about stocks.

The other chart of interest to me was particularly poignant. Long-time readers may remember the nasty relationship I had with the spring of 2008. I've mentioned it as something I'd never want to repeat. Well, not only has it repeated itself, but it has done so in slow motion. As the chart below suggests, the fractal form of the move from the low of March to the present is virtually identical to the form of the move from spring of 2008. So it's the same kind of torture, but prolonged by about 300% in terms of time.

Word on the street is that Fujisan will be doing another post on Slope this weekend; let's keep our fingers crossed, because I know how much everyone loved her last contribution!

This is just for fun (well, it's kind of serious too, since I have a huge long position in TWM).

Below is the ultra-bear ETF on the Russell 2000, symbol TWM, flipped upside-down. I've taken a stab at labeling its explosive rise "higher" (that is, lower). Any opinions?

I regularly read a couple of EWI's publications – – Short Term Update and the Financial Forecast – – and I find them very helpful in my own trading. The one which Prechter writes on a monthly basis, the Theorist, is especially enjoyable.

EWI just wrote me to let me know they are giving away the latest Theorist, so I wanted you to know. It's a really good one, too, because Prechter (who, late in February, said it was time to cover shorts) has become bearish again. Here's the link to your free copy. Check it out, if you are at all interested.