The markets traded in a narrow range today, failing to take out either the highs or lows from yesterday. Our call of yesterday’s high of 1378.04 on the SPX being a major top remains intact. Nothing in today’s market action negates this call. If nothing else, the action today may be part of the confirmation of this call, setting us up for a possible downward move on Friday.
On an hourly chart, the market seems to be tracing out a 5 wave sequence from Wednesday’s low of 1363.81. If the market moves higher, into the 1376.5-1377 level, without taking out the 1368 low from Thursday afternoon, a 5 wave move will have occurred. That would make the move from 1378.04 – 1363.81 the first wave of a major move down.
Today’s action could be quite telling.
Happy trading!
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