Monday 04/06/2020

On Friday I described the decline from 2538.18 to 2459.96 as a complete 5 wave sequence. From that point, in the last hour and a half of Friday's session, the SPX did some technically productive work, putting a series of higher highs, and lower lows on the 5 minute chart.

This morning the SPX continued that positive tone in a big way. A gap up at the open, to 2578.28, started the day off, and the index continued higher right until the close, with only minor pullbacks along the way. From the 2459.96 low, the SPX looked to have formed a wave 1, followed by waves a, b, and c of 2, an inverted corrected wave. The opening surge to the SPX to 2614.54, making wave d of wave 2, and the pullback to 2494.55 completed wave d, and the entirety of wave 2. It then looks like the move higher to 2636.28 formed wave 3, the pullback to 2620.52 wave 4, and the push up to 2676.85 near the close could be wave 5. The 5 waves outlined above satisfy my model for the completion of a 5 wave sequence, and the SPX is in overbought territory on the short term charts. Using my thresholds, this wave could complete anywhere from today's high of 2676.85, on up to a maximum level of 2692. So it is conceivable we see a continuation at the outset tomorrow.

On Friday I mentioned a slight adjustment to my count from the 2191.86 low. The adjustment affects Wave 3, which started at 2360.25. I originally had called 2637.01 as the end of that wave, but after some review, I would label that as wave d of 2 of an inverted corrected wave, the pullback to 2520.02 as the completion of wave 2, and then the three waves up to 2641.39 as waves 3,4, and 5, completing the wave from 2360.25. The move from 2641.39 down to 2447.49 still counts as a 5 wave sequence from 2641.39 to 2447.49, so the only thing this does is slightly alter the range for the completion of wave 5. I had been mentioning 2749 to 2886 for that range, but will change that to 2755 to 2888.

So to review, I see the SPX as having completed 4 waves from the 2191.86 low. The target range for wave 5 is between 2755 and 2888. Wave 4 of this sequence completed at 2447.49. Wave 1 of 5 completed at 2538.18. The second "wave" completed at 2459.96. This could be wave 2, or wave a of in inverted corrective wave.  The third wave of the sequence is in progress, and will complete either with today's high, or possibly up to 2692. At that point the index should pull back before continuing higher.

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.