Wednesday, July 12, 2017

SPX, NDX, BKX, INDU: Bears Need to Make a Stand

Well, it may be something of a near-term do-or-die moment for bears today/tomorrow, so we're going to get right to the charts.  Let's start with SPX, for reasons which will become apparent after you read the annotation:

INDU looks like a b-wave into the recent low, so I'd prefer not to see INDU sustain a breakout over the all-time high.  It could break that zone briefly and then return back down to break the purported b-wave low, but be aware that a break of the ATH would cast doubt on the remainder of the blue path.  And a sustained breakout would cast doubt on the b-wave, too, though frankly I'd be a bit surprised if that's anything other than a b-wave.

BKX's pattern remains legitimate for the moment.  Here again, a break of the ATH would invalidate the "2" but not the B -- it's just really hard to trade anything on the hopes of an expanded flat B-wave, at least until you see an impulsive reversal at the minimum.

NDX has plenty of room to run and remain below the ATH... and my very first instinct when we broke the red A/1 low was for the black "Flat C" option -- so we'll see how this shakes out:

In conclusion, bears probably need to see a reversal today/tomorrow to keep their near-term hopes intact here, otherwise the market has some room to run.  As a side note, I'm really looking forward to the markets getting back in sync one way or another, because the patterns across markets are still "all over the place," which makes the near-term incredibly difficult to predict.  Trade safe.

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