The SPX started off slightly to the downside this
morning, taking out yesterday’s low by a slim margin before moving higher. That
opening move took the index to 1627.47 where it quickly reversed direction. The
SPX soon was above 1634, and after a brief four point pullback, continued higher
to 1637.37. After another minor pullback, the SPX started a third leg higher
for the day, with this one carrying to 1641.18. From that point the index
digested its gains into the close, first falling back to 1639, and then
1635.34. After a bounce higher to 1640.12, the index fell to 1635.10 near the
close.
Yesterday I said that I expected the SPX to move
higher, and after the initial drop to 1627 it did just that. 1627 appears to
have completed a 5 wave sequence from 1669.51, but there are some that indicate
that may not have completed the entire wave from that point. From the 1627.47
low the SPX completed a 5 wave sequence higher as 1634.07-1630.44-1637.37-1634.99-1641.18.
It appears that the index is in the 5th wave from that high, but has
yet to complete a 5 wave sequence.
With that in mind, it is likely that the market
should move lower. Given the waves already completed, it would complete a
sequence at 1630. If the SPX moves down to 1630, and then back above 1641, I
would then expect the move higher to continue to 1651.
The move to 1641 failed to reach certain
parameters that would be indicative of the completion of the wave from 1669.51.
If the SPX continues lower, and breaks below 1627, this move is likely to
continue to 1618. This may play out as 1621-1628-1618. This would allow this
third wave from the 1709 high to complete very close to the 1621 support level.
From that point the SPX could rally.
No comments:
Post a Comment