The market opened slightly higher today, but quickly dropped below 1402. A rally from that point took the market above 1405, but then was met with more selling. By late morning, the market found itself back below 1400, falling to 1397. The midday hours were spent moving steadily higher, and by late afternoon, the market was back near 1405. The market dropped back to 1402, before rallying into the close.
Again the market traded in a narrow range between the 1407, and 1397 support/resistance lines. This continued the trend from last week.
I had expected the market to break out of this range today, but obviously the market needed at least one more day. It now looks like the market completed a 5 wave sequence from last Friday’s low of 1395.62 this morning at 1405.98. A corrective sequence followed, completing at 1397.32. The rally into this afternoon completed another sequence to the upside, which took the market to 1404.65.
My analysis from this weekend remains, with my view being the market completed wave 4 from 1267 Friday at 1395.62. I feel the market will still break out to the upside, with my wave 5 target remaining at 1497. A break below 1395.62 at this point would invalidate this scenario, and likely mean the market would continue lower.
Steve,
ReplyDeleteHave a projection of how much lower if we break below 1395.62?
Hi wavediver,
DeleteIt looks like it may end near 1395, possibly slightly lower. The next target would be 1380-1385. If that happens 1426 looks like the target for wave 5 from 1267.
Steve