SPX and INDU: Put the Weapon Down, Son

Since last update, SPX rallied back into the zone of the blue resistance line and was rejected.  After that, it went on to form something that's best described as opaque garbage.  The annotation below explains the conundrum:

INDU briefly broke its support line, but looks like it's going to whipsaw that directly:

In conclusion, there's not a lot of clarity in these charts, but if I had a gun to my head and had to say something, I'd probably lean toward saying it looks slightly more likely that it may need more downside to form any sort of complete wave.  But that's really only because some hypothetical person is holding a gun to my head.  If I hadn't invented that person, I might not say anything other than "wait and see," so don't hold me to it, I'm under hypothetical duress here!  Have a great weekend and trade safe.

SPX and INDU: Inflection Zone Acts as Resistance on First Test

Last update noted that we were getting into an inflection zone, and on Tuesday, the market put an exclamation point on that.

Let's look at the charts to see if bears can continue celebrating, or if they need to tread cautiously for the near-term, starting with INDU:

Next up is SPX:

So, as we can see on the near-term charts, things aren't locked down for bears just yet.  SPX is only three waves down (at present) and INDU has only retested its prior breakout, which has held (again: so far).  Since we can only trade what we see, what we see is a market that's been rejected at a potentially major inflection zone, but has yet to indicate whether it's going to make another run back up into that zone.

Bigger picture, we see the nature of the current inflection zone clearly -- but we need to keep in mind that big inflection zones have big ranges, too, so there's plenty of room for INDU to run up to new highs again and still be within the inflection zone.

In conclusion, bears had a fun day yesterday, but they haven't yet proven they're ready to take over (since they've only formed three waves down so far) and thus we can't yet rule out another run up.  We'll see how things develop for the remainder of the week.  Trade safe.

INDU Update: SPX? We Don't Need No Stinkin' SPX

Last update projected that INDU would need at least one more fourth wave correction, followed by another wave up to new all-time highs, and that has since happened:

As the chart notes, it's getting trickier now, which stinks because I won't be able to devote as much time to goofy jokes, since the market will become less predictable and there will now be fewer updates that say "no real change" and that allow me to reprint the same charts but with smiley-face stickers on them.

It's also getting tricky at long-term scale now, as the market appears to finally be approaching an inflection point that has significant and real MAJOR top potential:

In conclusion, the odds probably slightly favor one more 4/5 unwind still left, but I wouldn't bet the farm on that, especially since we're getting into the ballpark of a MAJOR (yes, I'm capitalizing it again) inflection zone.  Don't forget Monday is Labor Day, so the market is closed because it's disruptive to have traders going into labor right in the middle of the exchange floor.  Trade safe.

SPX and INDU: Getting Closer

Since last update, INDU made a new all-time high, as expected:

This SPX chart is a wonder to behold:

In conclusion, presuming we're dealing with a simple impulsive rally off the August lows, SPX and other indices should need roughly the same 4/5 unwinds that INDU needs, so that chart serves as a reasonable proxy for the broad market right now.  We should finally get a decent correction again once those waves complete.  Trade safe.

SPX and INDU: From the Dark Depths of Jackson Hole

On Friday, Powell wandered out to the microphone from the dark underground depths of Jackson Hole, appearing drunk, grabbed the mic forcefully and muttered something about "too many lost socks" before passing out, still holding the microphone and drooling.  

The market wasn't sure what to make of this, so it traded sideways for the day.

Which means, you guessed it, nothing has really changed from the updates of the past few weeks.  Although, INDU has now made a new high to match NYA:

SPX appears poised to resolve its previously-discussed-fourth-wave to the upside (which is/was the expected outcome of a fourth wave down, of course, as it's followed by a fifth wave up):

In conclusion, not much else to add other than -- assuming we're in a simple straightforward impulse rally -- a reminder it still looks like SPX and INDU will need at least one or two more 4/5 unwinds higher before completing the wave up from the 3/c low.

SPX Update: Time for The BLS to Remove The "L"

So, the big news since last update is that the BLS (Bureau of Laughable Stupidity) "overestimated" the yearly jobs number by 818,000 jobs.  So instead of yearly job creation being 2.9 million, it was 2.1 million -- an overestimation of nearly 40%, which would get the BLS fired from the private sector.  This is the biggest yearly revision to the NFP number since the Great Recession, a time when everything was in complete chaos.

Many pundits believe this will give Jerome "the Gnome" Powell the reasons he needs to justify a discussion about cutting interest rates during his Jack's Son Whole speech today (10 a.m. sharp, coat and tie encouraged, but cut-off jeans and t-shirts okay).  The only question pundits have is whether he'll decide to cut rates by 25 or 50 bps next month.

Chart-wise, still not a lot to add, but bears are back into a price zone where they do have an option (classic 3-3-5 flats of the "non-expanded" variety need to retrace 90% before they can work, so this wasn't an option at lower prices), even if it appears to be the underdog at the moment:

Not much else to add today, Powell's speech will probably set the tone for today's session.  Trade safe.

SPX, NYA, INDU Updates

Since last update, NYA made a new high:

This has implications for INDU, since it's almost a clone of the same pattern.

And, of course, all of that implies SPX will probably follow along with the crowd:

In conclusion, at some point, we do need to see a larger fourth wave develop, to pair with the 1s and 2s of the bull nest noted in INDU (so a micro fourth wave within the rally wave since the swing low, then leading to a micro fifth wave for that same rally wave), and it's at least possible that the first wave down (a/1) for that occurred during yesterday's session, though I have little confidence in this market at the moment.  Trade safe.