On Tuesday the moved lower at the open, falling to
2001.01 before rallying back to 2013.11 near the close. With the index
completing 5 waves from the 2001.01 low to 2013.11, and below the previous
2024.46 high, I was expecting the SPX to decline today. This expectation was
also partly due to my erroneous interpretation that the move from 2024.46 to
2001.01 was not a complete 5 wave sequence.
After further reviewing my charts, the move from
2024.46 was a complete 5 wave sequence.
The SPX then completed a sequence at 2013.11 as I discussed yesterday.
This morning the index gapped higher, reaching a high of 2023.56 a few minutes
after the open. The SPX then declined in three waves down,
2016.20-2020.61-2014.42. From yesterday’s 2013.11 to 2014.12 5 waves can be
seen as 2013.11-2009.86-2023.56-2016.20-2020.61-2014.42. This completed an inverted
corrective wave from the 2001.01 low. The SPX then rallied again to 2022.92,
pulled back to 2016.36, and then rallied to 2023.77. Putting this all together from
the 2001.01 low gives 2001.01-2013.11-2014.42-2022.92-2016.36-2023.77, which
completed a 5 wave sequence.
Despite the initial intensity of this morning’s
move, the SPX failed to take out the previous 2024.46 high. Three times it came
within two points of that mark; with two of those getting within one point, and
three times the index was turned back.
Given the completion of a 5 wave sequence today at
2023.77, the expectation would now be for the SPX to decline. Near term support
is at 2019 and then 2011. Longer term support is at 1999, and then 1943. The
SPX again appears to be at a decision point. My upside target remains 2070, and
a move above 2024.46 would likely signal a continuation of the move from 1820.66
to that level.
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