“Adding 10 years to any top, it will give you top of the next 10 year cycle.” W.D. Gann
Let’s take a look at 2015. Ten years ago.
In 2015 there was a top in February. As was the case in 2025.
It did not produce a sharp decline, it basically arrested upside momentum.
There was another top in May. Ditto 2025.
But the real move occurred following a top in July.
It perpetuated a sharp selling into August.
Yesterday we stated that this July is 90 days/degrees from the April low.
A normal time frame to expect a turn if the market has been trending strongly.
We went on to say that mid-August is 180 degrees from the February 2025 all-time high.
A 7 week drop from July into mid-August would echo the 7 week drop from Feb to April 2025.
As offered recently if we get a “normal” 10% correction it would take us down to the 5500 region which ties to a 50% retrace. It could also carve out the right shoulder of an inverse Head and Shoulders bottoming pattern.
I went on to say that if that plays out and we then eclipse a presumed top in this region on a test of the Feb high, it could project to the 6700 region.
The alternative scenario is that the SPX struck a Primary High in February and is putting in a Secondary High over coming days.
Let’s take a look at two other major tops in this century and their pattern of Primary and Secondary Highs.
They are not going to be exact, but they do mirror each other to some degree.
In 2000 the SPX struck a Primary High in March followed by a sharp decline and then produced a Secondary High in late August, 23 weeks later—essentially at the same price as the March peak.
In 2007 the SPX struck a Primary High in July followed by a sharp drop.
It rallied back with authority to score a Secondary High that was a Throw-Over in October.
It is important to note that the market did not become unglued until the opening bell rang in January 2008 more than 2 months later.
As Gann would say…”two periods of time on the side”.
IF we should carve out two periods of time on the side from a presumed Secondary High in July, it would take us out into the Fall.