• 274 days Could Crypto Overtake Traditional Investment?
  • 279 days Americans Still Quitting Jobs At Record Pace
  • 281 days FinTech Startups Tapping VC Money for ‘Immigrant Banking’
  • 284 days Is The Dollar Too Strong?
  • 284 days Big Tech Disappoints Investors on Earnings Calls
  • 285 days Fear And Celebration On Twitter as Musk Takes The Reins
  • 287 days China Is Quietly Trying To Distance Itself From Russia
  • 287 days Tech and Internet Giants’ Earnings In Focus After Netflix’s Stinker
  • 291 days Crypto Investors Won Big In 2021
  • 291 days The ‘Metaverse’ Economy Could be Worth $13 Trillion By 2030
  • 292 days Food Prices Are Skyrocketing As Putin’s War Persists
  • 294 days Pentagon Resignations Illustrate Our ‘Commercial’ Defense Dilemma
  • 295 days US Banks Shrug off Nearly $15 Billion In Russian Write-Offs
  • 298 days Cannabis Stocks in Holding Pattern Despite Positive Momentum
  • 299 days Is Musk A Bastion Of Free Speech Or Will His Absolutist Stance Backfire?
  • 299 days Two ETFs That Could Hedge Against Extreme Market Volatility
  • 301 days Are NFTs About To Take Over Gaming?
  • 302 days Europe’s Economy Is On The Brink As Putin’s War Escalates
  • 305 days What’s Causing Inflation In The United States?
  • 306 days Intel Joins Russian Exodus as Chip Shortage Digs In
  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