Wednesday, August 9, 2017

SPX and NDX Capture Upside Targets and Reverse

Recent sessions have been a win for readers, as first INDU captured its upside target, then SPX and NDX captured theirs -- and more importantly, all have since reversed.  Lets look at NDX first, since this has been the market I've been advising bears to take advantage of (last update I even mentioned it as "bears' best hope for another leg down.")

NDX, as it turns out, perfectly captured the 2/B target zone (5960-80) from July 17:

I think some folks were having trouble envisioning how SPX could capture my preferred target zone and reverse, but that's exactly what it did:

And finally, it's a bit too soon to tell if INDU will fail its second target zone, but it does look like it probably at least wants to test the blue trend line first.  It's also worth considering that it is at least possible that the whole rally here is done for the time being, because there are enough waves in place for a completed fifth, if that's what it wants:

In conclusion, recent sessions have been "as good as it gets" for readers, with target captures across the board, as well as the anticipated reversals.  For the near-term, at least, we're now looking for lower prices.  If those declines become larger impulses, then we'll be able to more seriously consider that larger fifth waves may indeed have completed, and can then hold out some measure of hope for the potential of significant declines, which could stretch far beyond the first downside target zones.  Trade safe.

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