Friday, February 27, 2015

SPX Update: Bears Finally Get an Opportunity

Two quick charts today, which pretty much say it all.

Before we get into these, I had noted on Monday that a break over 2110 SPX would likely lead to 2115-17+/-, and that zone would have potential to mark at least a minor top.  The market ran to 2119, before reversing.

First off, the SPX near-term chart suggests that we haven't bottomed yet.  I published this chart in our forums shortly after the cash close, and the overnight action in the E-mini S&P futures (ES) seems to be confirming this count so far:

The preferred near-term count would be invalidated north of 2120.  Stepping back a bit, here's how it looks on the 30-minute chart.  The first bearish trigger target was captured yesterday -- if the count shown above is correct, then the second target should be captured as well:

In conclusion, this appears to be the best opportunity bears have had since 2072 SPX.  If this is a bull wave, then it's likely that this will prove to simply be a fourth wave correction.  If the bears have control, then it will turn into something more significant, and 2058 comes into view as a potential target.  Either way, near-term, prices appear likely to be headed lower, so if you're a bear who's been waiting patiently for another decent opportunity, then this is the best one that the market has presented in a while.  Trade safe.

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