The market opened higher today, and then moved steadily higher to a new uptrend high of 1399.54. After a minor pullback, the market rose again, moving slightly higher than the previous high, peaking at 1399.63. The market then continued trading in a very narrow range throughout the afternoon, until just before the close. At that point the market fell slightly below that range, moving down to 1393.82, before rising slightly into the close.
From Friday afternoon’s low of 1389, the market completed a 5 wave sequence to the new uptrend high of 1399.54. After that the market appears to have formed a semi-inverted corrective wave, bringing the market down to 1393.92 near the close.
If this count holds, a 5 wave sequence from 1354.65 will complete at 1400-1401. At that point the market would be due for a correction. Since I see this market moving higher, and the 5 wave sequence described above would be wave 1 from 1355, the possibility of a complex correction is fairly high. This would see the market top at 1400-1401, a small pullback, most likely slightly below today’s low, and then a move above 1400-1401. This would signal the next leg of this move higher is underway.
The corrective wave from today’s high could carry to 1389, a move below that would mean the market completed a 5 wave sequence from 1355 today, and the correction could continue further. A move above 1401 would also mean a 5 wave sequence completed today, but that the market is headed higher.
Support remains at 1387-1397, 1384, and 1367. Resistance is at 1406, and then 1426.
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