• 288 days Will The ECB Continue To Hike Rates?
  • 288 days Forbes: Aramco Remains Largest Company In The Middle East
  • 290 days Caltech Scientists Succesfully Beam Back Solar Power From Space
  • 690 days Could Crypto Overtake Traditional Investment?
  • 695 days Americans Still Quitting Jobs At Record Pace
  • 697 days FinTech Startups Tapping VC Money for ‘Immigrant Banking’
  • 700 days Is The Dollar Too Strong?
  • 700 days Big Tech Disappoints Investors on Earnings Calls
  • 701 days Fear And Celebration On Twitter as Musk Takes The Reins
  • 703 days China Is Quietly Trying To Distance Itself From Russia
  • 703 days Tech and Internet Giants’ Earnings In Focus After Netflix’s Stinker
  • 707 days Crypto Investors Won Big In 2021
  • 707 days The ‘Metaverse’ Economy Could be Worth $13 Trillion By 2030
  • 708 days Food Prices Are Skyrocketing As Putin’s War Persists
  • 710 days Pentagon Resignations Illustrate Our ‘Commercial’ Defense Dilemma
  • 711 days US Banks Shrug off Nearly $15 Billion In Russian Write-Offs
  • 714 days Cannabis Stocks in Holding Pattern Despite Positive Momentum
  • 715 days Is Musk A Bastion Of Free Speech Or Will His Absolutist Stance Backfire?
  • 715 days Two ETFs That Could Hedge Against Extreme Market Volatility
  • 717 days Are NFTs About To Take Over Gaming?
Billionaires Are Pushing Art To New Limits

Billionaires Are Pushing Art To New Limits

Welcome to Art Basel: The…

The Problem With Modern Monetary Theory

The Problem With Modern Monetary Theory

Modern monetary theory has been…

How The Ultra-Wealthy Are Using Art To Dodge Taxes

How The Ultra-Wealthy Are Using Art To Dodge Taxes

More freeports open around the…

  1. Home
  2. Markets
  3. Other

Daily Analysis

We now have to be watchful since price should be attempting to complete the corrective down leg from the December 7 peak (SPX = 1267), and allow the awaited Santa "rebound".

From almost the beginning of this down leg I was aware that the EW pattern that price was tracing was not impulsive hence I was not expecting a fully retracement of the previous up leg.

I have been looking at a potential Double ZZ as price was drifting lower but maybe the overlapping pullback can be easier labelled as a Zig Zag with the wave (C) on the verge of finishing an Ending Diagonal.

If this is the correct pattern then price will be able to rally at least into next week.

Keep in mind that the break out of a falling wedge is always swift and usually price attempts to retrace towards the origin of the wedge of 1258 which, btw, almost coincides with December 2010 eom print of 1257.64. Definitely this # could be a magnet going into year-end.

As a potential target we have the 1.618 extension at 1200


Larger Image

If the ED option is busted then I will take up again the Double ZZ option, which seemingly needs more business to the down side in order to establish a bottom presumably in the 1190 area.


Larger Image

Regarding the overall EW pattern from the October 4 low unfortunately I have a lot of reasonable doubts and honestly right now I don't have enough confidence on none of the 4 options I discussed this weekend:

  1. Impulsive wave (C)
  2. Triangle wave (B)
  3. Larger Double ZZ wave (B)
  4. Bearish resolution, which calls for a wave (B) in progress with a potential target in the 1000 area.

Therefore for the time being I maintain my focus in the short-term time frame.

From the daily chart below we can know that:

  • Any meaningful rebound needs an eod print above 1231.47
  • Price is a approaching an area (0.618 retracement = 1200; trend line off October low; gap at 1195) where it is reasonable to expect a rebound attempt.

In addition we have the Santa bullish seasonality.


Larger Image

I would like to add 2 thoughts:

  • The impulsive wave (C) option needs a considerable improvement of momentum and breadth indicators together with impulsive upside action.
  • The Triangle option probably should need a larger wave (c) with a bottom closer to the 1180 area.

We have to realize that we are trapped by a large amount of uncertainties, which is clearly reflected by the price action.

 

Back to homepage

Leave a comment

Leave a comment