Wednesday's Market 04/09/2014

The rally off yesterday morning’s 1837.49 low continued today, giving credence to the idea of that being an important low. Looking at the move from that low, the SPX completed a wave 1 at 1850.46. That was followed by an inverted corrective wave to 1847.67. This correction took the shape of what is more commonly known as an expanding triangle. From that point the SPX formed 5 waves up to 1858.38, which was followed by a pullback to 1852.38. Another 5 wave sequence to the upside took the index to 1869.86, and was again followed by a small pullback, this time to 1866.33. This looks to complete a more complex inverted corrective wave from the 1850.46 wave 1 high, which completed as 1847.67-1858.38-1852.38-1869.86-1866.33.

This set-up indicates that there is further upside to this move. I continue to count this as Wave 5 from the June 2013 1560.33 low. The 1837.49 low yesterday would mark the completion of Wave 2 of 5 from that point, with a minimum target for Wave 3 of 1909. Once this sequence from 1560.33 completes, it should also complete a sequence from the October 2011 1074.77 low. The minimum target for the completion of this wave is 1957, with an optimal target of 2001.

Tuesday's Market 04/08/2014

Since the SPX hit 1882.35 on March 11^th, the index has been in a protracted corrective wave that contained many twists and turns. This wave seemingly started off as a simple corrective wave, turned quite complex after dropping to 1839.57. But this complex wave may have ended today at 1837.49.

The most apt description of this wave is a semi-inverted corrective wave. Wave A came quickly with a drop to 1854.38. Wave B was the wave that at times seemed too complex and unusual, but eventually managed to resolve itself with the all time high of 1897.13. Wave C ended Friday at 1863.26, and was followed by an inverted corrective Wave D which ended yesterday at 1852.77. The drop this morning to 1837.49 would seem to complete Wave E, and a 5 wave sequence from the 1882.35 high.

It is now likely that the SPX will again move higher, reaching that 1909 minimum target I have talked about previously. A move below 1837.49 at this point would indicate something else is occurring, with another sequence lower to come.

Thursday's Market 03/20/2014

It was a benign opening for the SPX given yesterday’s late afternoon fireworks. The index opened slightly to the downside, falling to 1858.46. After trading sideways for several minutes, the SPX broke to the downside once more, this time falling to 1854.63. The mood was decidedly bullish from that point, with the index quickly rebounding to 1868. After dipping to 1862, the SPX rose steadily, reaching 1873, and then traded in a narrow range to 1873.49 before falling back to 1868.33 near the close.

Picking up from yesterday’s count, it looks like the opening move to the downside completed a5 wave sequence from 1864.07, and Wave B of 2 from 1874.14. The rally off that low to 1867.85 completed Wave C, which was followed by a more complex Wave D to 1870.87. The final push higher to 1873.49 completed Wave E and Wave 2 from 1874.14.

The rally from 1854.63 carried slightly further than I had expected, but looks to have completed in an area that keeps my current count intact. This has the SPX in a 1-A-B-C-1-A-B-C-1-2 pattern from 1882.35, the point I consider the termination point of the move from 1837.92. Essentially this a nested wave structure with the bias being to the downside. This count hinges on the SPX remaining below 1874.40, a level which is precariously close at the moment, and which the index has flirted with for three days now. The above scenario still seems to be the best fit for the waves, but again, this count would be invalid if the SPX moves above1874.40.