Wednesday, June 19, 2013

Updates to the Long-term SPX Projections

The SPX has reached the target zone, but the near-term is still a bit unclear in regards to what the market has planned from here.  Accordingly, I'm going to update the long-term charts.

It's always helpful to check how a count is tracking, so before we look at the current chart, let's take a look at my preferred count projection chart from back on February 7 and see how it's performed so far.

Below is the projection I published on February 7 (though for some reason I dated it "2/8/13" in the annotations -- though I'm reasonably proficient at tracking the market, apparently I have trouble using a calendar.).

Note: Right mouse click the chart and select "open in new window" to bring it up at full size.

If we compare that with the actual performance of the market, we can see that projection has tracked exceptionally well for the past four and a half months.  Note that for purposes of aligning charts across time frames, I've changed a few of the labels on the chart below (red 3 became red iii, for example).  I've also zoomed in a bit on the current price action:

The question in my mind is still whether red iv has completed or not.  I remain slightly in favor of the idea that it is not complete, and will become more complex, ultimately correcting lower before finding a bottom.

Of some interest is the weekly SPX chart, which shows MACD is very close to a bearish crossover.  Of course, it hasn't quite crossed yet, but this is the closest it's come in a long time:

The near-term chart is essentially unchanged since yesterday, and still a bit messy to interpret.  Note the target zone has been reached.

In conclusion, if my interpretation of the near-term structure is correct, the market is in the topping zone.  Intermediate term, I remain marginally in favor of lower prices.  Long-term, I believe that new highs still await.  Trade safe.
Reprinted by permission, Copyright 2013 Minyanville Media Inc.

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