The SPX opened slightly lower this morning,
dipping to 1874.55 in the first few minutes. Following that dip the index
continued the rally off yesterday’s low. The SPX ran up to 1887, fell back to
1883, and then moved higher to 1889. This has been a pretty impressive rally,
with the SPX moving up 29 points from yesterdays low. After hitting 1889 the
index started to pull back. The SPX moved steadily lower throughout the
afternoon, dropping to 1870.05 before bouncing into the close.
This morning’s run up was unexpected form my point
of view, but may actually turn out to be more bearish than if the decline had
continued this morning. After reviewing my charts, this appears to be a
semi-inverted corrective wave from the 1880.58 low. This means today’s high was
the completion of the second wave from the 1891.33 high. The decline from today’s
high looks to be a 5 wave sequence, and possibly the third wave from 1891. If
the bounce into the close was the fourth wave, the fifth wave would now project
to the 1775 support level.
Resistance is still between 1892 and 1902, and the
1923.