The market opened modestly lower, but soon rebounded to 1345. Another drop to 1338 followed, after which the market traded in a narrow, up trending range, which brought the market back to 1343.66. The market then underwent another sell off, which took the SPX to the low of the day at 1333.25. At that point the market rallied, bringing it back to 1344.26, before fading into the close.
It appears the market completed wave 3 from 1374 yesterday at 1336.27. The moves from then seem to be either a semi-inverted corrective wave 4, or wave 4 from 1374, followed by waves 1, and 2 of one lesser degree. If this is a semi-inverted corrective wave, we will see a move slightly higher, near 1346, which would complete wave 4 from 1374, with wave 5 following, with a target of 1318.
If wave 4 has already completed at 1345, the move down should start, again with a target near 1318. If the market moves above 1346, it could continue higher, with resistance at 1357-1358, and 1367. A move below 1336.27 means the move down from 1374 is continuing, with a target of 1318.
The key levels for today are 1346, and 1336. A break of either of those levels should give us the short term direction of the market. Longer term, the market should still work lower, although I still view this as a corrective move, with higher prices to come.
Steven, Do you think market will climb up immediately after 1318 level reached? or there is still another downwave sequence?
ReplyDeleteSteven, one more question, so you are now still looking 1318 as the target of wave4 of wave3? if yes, wave5 of wave 3 still 1393?
ReplyDeleteHi Nick.
DeleteFirst, once we reach 1318, I would expect the market to move higher, and not form another 5 wave sequence down. As a break of 1310, and 1306 would invalidate this count, there isn't much room for another sequence down. If there is, it should be very minor. If the market moves below 1310, and then 1306 we could see a continuation of the down move.
Secondly, for the moment I will use 1393 as the target for wave 5. There is a secondary target at 1475. Once the wave develops, I should have a better idea of which one the market will go.
Thanks,
Steve