However, it seems to be clearest, at least from an Elliott wave perspective, what the Nasdaq is doing long-term. So let's discuss the Nasdaq for now.
In April this year the Nasdaq touched the upper channel paralleling the 2002 and 2009 bottoms. Even if we are in a new bull market and where I have primary wave [B] marked is really the end of the entire correction, the move up from 2009 has been rather lackluster, and thus would call for a reasonably deep retracement.
I expect the Nasdaq will at the very least retest the blue lines at 2,100-2,200, which represent the breached channel lines from the all-time high through what I have labeled Primary [A] of Cycle b. If it is merely a wave 2 down in a nascent bull market, it would likely stop there and then skyrocket; if we are indeed on the cusp of a deep bear market as I suspect we are, then this test would complete the head of a head-and-shoulders pattern.
In the latter case, the next logical step would be to complete the H&S by retesting from below the broken channel line of Intermediate (2) and (4) of [C], then falling further from there setting up another H&S on a retest of the blue lines before further bear.
Either way, I still expect to see the Nasdaq fall at least to 2,200 in the next six to nine months or so (i.e. by 2013Q2), whether the market be secular bull or secular bear. This would equate to a 25% decline from current values, and a 30% decline from the April highs. The Nasdaq may, especially if Apple wants to retest its 644 high (or make a higher high on lower weekly/daily RSI and overbought stochastics), challenge the channel line again, currently at 3,200-ish, beforehand. But it need not.
A Nasdaq decline is not likely to happen without an Apple one, at any rate, since Apple makes up 12% of the index. As much as Apple permabulls may hate to admit it, the stock has been monthly RSI overbought since 2010Q3 and monthly stochastics overbought since 2009Q4. Apple has been an incredible growth story and is a solid company, to be sure. It certainly won't go bankrupt, but it is overbought.
And a decline in Apple stock to $350/share, which I think is a more reasonable price, would be over 3% of the Nasdaq all by itself even if every other stock on the listing stays flat.
