Friday 04/03/2020

The SPX opened slightly lower this morning, before moving higher, to slightly above yesterday's high to 2538.18. From there it was all downhill, as it has mostly been on Fridays. Seems like no one wants to carry their longs into the weekends. So except for a few very minor rallies, the index went pretty much straight down from 2538.18 to the low of the day at 2459.96. The SPX did then move slightly higher into the close, making it back to 2497.10 shortly before the close.

Picking up on the count from where I left off yesterday, the SPX had completed Wave 2 from the 2447.49 low, and was moving higher in what appeared to be wave 3. With the move to slightly higher levels this morning, the index looks like it actually completed waves 3 and 4 yesterday, and wave 5 of the sequence this morning. The entire sequence would the be 2447.49 - 2488.09 - 2467.68 - 2509.07- 2492.10 - 2538.18.

Looking at the move from this morning's high of 2538.18 to the low of 2459.96, it looks the SPX completed a 5 wave sequence to the downside. Wave 1 ended at 2495.78. Wave 2 was the meandering inverted corrective wave that terminated at 2487.72. Waves 3, 4, and 5 then followed at 2464.42 - 2473.97 - 2459.96.

So my ongoing count is still intact. From the 2191.86 low, the SPX completed the first wave at 2300.73. The index then formed an inverted corrective wave 2 the ended at 2360.25. My count then has wave 3 ending at 2637.01. In looking at it again today, there is a count that has wave 3 completing at 2641.39. Either way, there is a 5 wave count down, that ends at 2447.49, for the fourth wave. I'll cover that in more detail this weekend. So this count suggests the SPX will rise in a wave 5, with a target of 2749 - 2889.

Thursday 04/02/2020

The SPX opened slightly lower this morning, but quickly reversed to move above yesterday's close, before once again moving lower to 2455.79. At that point the index found some direction, rising steadily to 2532.21. From there the SPX moved sideways for the next couple of hours before falling to 2467.68. After that the index once again moved steadily higher into the close, moving back up to 2530.13, before dipping into the close.

Although the SPX did move lower at the onset, it did hold yesterday's 2447.49 low. Today's action can best be viewed as a wave 1 from that low to 2488.09. Most of the rest of the day was then spent working on the inverted corrective wave 2, which looks to have ended at 2467.68. That would now put the SPX in a wave 3 from that low. Since the index did end the day in overbought territory on the 15 minute chart, the 3 waves off the low could possibly be part of a corrective wave, so the 2447.49 low remains important.

I am still viewing this as the start of wave 5 from the 2191.86 low. A move below 2360.25 would invalidate that count. Until then my short term target remains 2749 to 2889.

Wednesday 04/01/2020

Sorry I missed posting last night. I try not to interject personal things or opinions into the blog, because my objective is to analyze the market as best I can. While the rest of Illinois is under a "stay at home" order, I happen to work for an "essential business", and so, luckily, or unluckily, still working. Not in the medical profession, so not one of the "heroes", but it has been busier than usual. So doing my best to keep myself safe, and more importantly, more "at risk"loved ones safe. Hope everyone is doing the same. All about priorities.

But enough of that. Numbers keep me sane, so let's get to that.

Picking up where I left off, I mentioned on Monday that the 2631.80 high on the SPX might have completed a 5 wave sequence from the 2520.02 low. On Tuesday the SPX did open slightly lower, but soon moved higher, topping out at 2641.39. This was slightly above Friday's 2637.01 high, and looked like it might be a breakout to the upside. However, the index quickly reversed course, dropping to 2588.90, recovering a bit, then dropping again to 2571.15 before staging a small recovery into the close.

This morning the SPX gapped down at the open, dropping to 2486.22. After a short-lived rally attempt, the index fell to 2466.99, rose to 2494.67, and then fell to the low of the day at 2447.49 near the close.

My count from the 2191.86 low remains intact. I had mentioned that the SPX may have to correct from the 5 wave sequence starting at 2360.25, and ending at 2637.01. The support levels I gave for this scenario were 2482 first, and then 2402. As I have mentioned, some of these support levels are a work in progress. The levels I mentioned were derived using 2360.25 as the initial point. I noticed tonight that by using 2191.86 as the initial point, it would give 2443 as the ideal level, fairly close to today's 2447.49 low. Something for me to take note of.

So continuing my count from the 2191.49 low, the SPX completed Wave 1 at 2300.73. After an inverted corrected wave from there to 2360.25, the index then completed a 5 wave sequence at 2637.01 for Wave 3. The entire move from that high to today's low of 2447.49 would be Wave 4. If correct, that would mean that the SPX is about to embark on Wave 5. Given the wave structure thus far, Wave 5 would project to between 2749 and 2889.

With the markets as they are, and everything going on, I feel it is as important, if not more so, to know when you are wrong, as when you are right. So in that vein, a drop below 2360.25 would invalidate the count. Otherwise I am looking for the SPX to move up to the 2749 - 2889 level.