• 2 days 3 Semiconductor Stocks Looking Great On EV Demand
  • 4 days Robinhood’s $40B March IPO Is In Grave Danger
  • 5 days Are Bots Responsible For GameStop’s Massive Runup? 
  • 6 days Learning From Buffett’s $11 Billion Mistake
  • 9 days The Token Boom Spawns Digital Gold Mine in Art, Collectibles
  • 10 days The “Oil Of The Future” Is Set To Soar In 2021
  • 10 days Wealthy Could End Up Footing The Bill For States’ Budget Shortfalls
  • 11 days Could This Be The Hottest Commodity Play Of 2021?
  • 11 days JP Morgan Says Fintech Will Steal The Disruptor Show
  • 13 days Facebook Plays Dirty Down Under
  • 14 days Could This Be The Most Exciting Lithium Play Of 2021?
  • 16 days China Sidelines US As EU’s New Top Trading Partner
  • 18 days 3 Smart Ways To Play the Global Chip Shortage
  • 19 days Flying Taxis Are The Number One Speculative Bull Arena
  • 20 days Ocean Power: The Missing Link
  • 25 days Luxembourg’s Ultra-Secrecy Still Attracts Hundreds Of Billionaires
  • 26 days Robinhood Is Under Fire And Trading ‘Democracy’ Is In Question
  • 27 days Bitcoin Could Be Worth $12 Trillion In The Long-Term
  • 28 days The Biggest Tech IPO Since Uber … For Farmers
  • 30 days The Biggest Boost Yet for the Cannabis Industry
Is The Bull Market On Its Last Legs?

Is The Bull Market On Its Last Legs?

This aging bull market may…

Another Retail Giant Bites The Dust

Another Retail Giant Bites The Dust

Forever 21 filed for Chapter…

TheWaveTrading

TheWaveTrading

TheWaveTrading

My goal is to establish the most likely path that the price of a particular asset will undertake and profit through ETF instruments both on…

Contact Author

  1. Home
  2. Markets
  3. Other

SP500: The Magnitude of a Trend Line

The lower high established at the November peak can be the first step of a trend reversal.

A new bearish cycle will be confirmed if price breaches the August low establishing a lower high.

If this is the case the risk of a retracement towards the range 1574 - 1553 would substantially increase.

In the mean time as long as SP 500 does not reclaim the 10 mma which today stands at 2041 the trend is pointing down.

S&P500 Monthly Chart
Larger Image

A trend line that connects the October 2014 and the August 2015 lows is probably the line in the sand. If the trend line is breached we could make the case that it is the neckline of a Head and Shoulder. The measured target is located at 1611.

S&P500 Monthly Chart 2
Larger Image

In the weekly time frame the Head and Shoulder can be seen clearly.

S&P500 Weekly Chart
Larger Image

If the neckline holds SP 500 could be carving out a Bullish or Bearish Triangle:

  • Bearish Triangle:

S&P500 Bearish Triangle
Larger Image

  • Bullish Triangle:

S&P500 Bullish Triangle
Larger Image

Elliott Wave wise the Triangles scenarios can only pan out if the decline from the November peak unfolds a 3-wave down leg.

So far, in my opinion, from the November "lower" high we can count a 3-wave down leg in progress. The wave 3 is probably not done yet

Once the wave 3 is in place if bulls are not able to reclaim the "overlap" line at 2005 odds should favor an impulsive decline which will most likely breach the neckline of the H&S opening the door to a large retracement.

S&P500 Daily Chart
Larger Image

 

Back to homepage

Leave a comment

Leave a comment