• 658 days Will The ECB Continue To Hike Rates?
  • 659 days Forbes: Aramco Remains Largest Company In The Middle East
  • 660 days Caltech Scientists Succesfully Beam Back Solar Power From Space
  • 1,060 days Could Crypto Overtake Traditional Investment?
  • 1,065 days Americans Still Quitting Jobs At Record Pace
  • 1,067 days FinTech Startups Tapping VC Money for ‘Immigrant Banking’
  • 1,070 days Is The Dollar Too Strong?
  • 1,070 days Big Tech Disappoints Investors on Earnings Calls
  • 1,071 days Fear And Celebration On Twitter as Musk Takes The Reins
  • 1,073 days China Is Quietly Trying To Distance Itself From Russia
  • 1,073 days Tech and Internet Giants’ Earnings In Focus After Netflix’s Stinker
  • 1,077 days Crypto Investors Won Big In 2021
  • 1,077 days The ‘Metaverse’ Economy Could be Worth $13 Trillion By 2030
  • 1,078 days Food Prices Are Skyrocketing As Putin’s War Persists
  • 1,080 days Pentagon Resignations Illustrate Our ‘Commercial’ Defense Dilemma
  • 1,081 days US Banks Shrug off Nearly $15 Billion In Russian Write-Offs
  • 1,084 days Cannabis Stocks in Holding Pattern Despite Positive Momentum
  • 1,085 days Is Musk A Bastion Of Free Speech Or Will His Absolutist Stance Backfire?
  • 1,085 days Two ETFs That Could Hedge Against Extreme Market Volatility
  • 1,087 days Are NFTs About To Take Over Gaming?
Another Retail Giant Bites The Dust

Another Retail Giant Bites The Dust

Forever 21 filed for Chapter…

What's Behind The Global EV Sales Slowdown?

What's Behind The Global EV Sales Slowdown?

An economic slowdown in many…

Market Sentiment At Its Lowest In 10 Months

Market Sentiment At Its Lowest In 10 Months

Stocks sold off last week…

  1. Home
  2. Markets
  3. Other

SPX: Follow Up of the Short Term EWP

Today just a brief update.

So far the "working" map is fitting in accordance with my preferred short-term scenario, which calls for a retracement of the June's up leg.

Last Sunday I highlighted 3 possible EWP.

Today I remove the wave (C) off the September 25 lower high option; the other two candidates are equally balanced.

Potential short-term paths from the September 14 high:

1. Zig Zag:

Therefore yesterday, price should have begun the wave (C) down. The wave (C) has an extension target in the range 1413-1386.

2. Triple Zig Zag:

Therefore yesterday price should have begun the third Zig Zag (ABC) down.

Yesterday's reversal at the 0.618 retracement after having completed a Double Zig Zag is strongly suggesting that he bounce off last Wednesday's lod is over, although there is no confirmation yet since the sequence of higher lows is still in place.

Bears today have to round off yesterday's bearish set up with follow through to the down side.

SPX 30-Minute Chart
Larger Image

The consensus is looking for an overall shallow pullback with a target at 1422 - 50 d MA = 1419. Then maybe 2 lower ranges could come into play:

  • 1419 - 1396
  • 1396 - 1371

SPX Daiy Chart
Larger Image

If, as I expect, there is soon a break down below 1430 instead of guessing where price will establish a bottom, we need to see:

  • A completed EWP.
  • Positive divergences.
  • Extreme oversold readings of TRIN / TICK
  • High CPCE reading.
  • Fear ==> VIX closer to its 200 d MA .

Conclusion:

  • The internal structure of the pullback off the September 14 high is strongly suggesting that price is ONLY involved in unfolding a corrective pattern that once is over it will open the door to the resumption of the intermediate up trend.

  • The potential target is located in the range:

    1. 1. 50 d MA - 1396
    2. 2. 1396 - 1371
  • The catalyst for the next "take off" could be the announcement of the Spanish bailout, but earning season is also approaching, hence price may adopt a holding pattern.

  • The immediate time frame is bearish biased since we don't have a completed EWP off the September 14 high.

 

Back to homepage

Leave a comment

Leave a comment