It was another record setting day for Wall Street,
as the SPX reached another all-time high of 1698.78. The market gapped up at
the open again today, and hit that record within the first few minutes of
trading. After that it was what for this market qualifies as a steep decline,
as the SPX dropped to 1691.13 after the first hour and a half. The market tried
to rally after that, rising through most of the afternoon, with the index
climbing back to 1696.26. The SPX then sold off during the last hour, dropping
to 1691.52 before rising into the close.
Looking at the waves from yesterday’s 1697.61
high, I count a 5 wave sequence down to 1693.01, a sequence up to 1698.78,
followed by 3 waves down at 1694.05-1695.58-1691.13. This completed a
semi-inverted corrective wave from the 1697.61 high, which was a little
unexpected. From 1691.13, the SPX completed what appear to be 3 waves higher,
before the late afternoon sell-off.
The appearance of the semi-inverted corrective
wave, followed by what appear to be only 3 waves higher, leads me to believe
that 1696.26 is the completion of a wave from 1671.84. This could be Wave D of
an inverted corrective wave from 1626.61. If this is true, I would expect a
pullback to around 1684. This could also be a smaller degree wave 1 from
1671.84. This will be determined by whether or not the SPX moves lower from
here.
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