Wednesday, July 3, 2019

SPX and INDU: Noise, Noise, Noise

No change from last update, which expected SPX would likely push on toward 2990-3000 before it had a chance to give much consideration to doing anything else.  In regards to the big picture, this pattern is shaping up to be the toughest we've seen in at least two years.  Because there are numerous options on the table, we're presently in an extremely difficult position in terms of reconciling the potential counts.

Recall that there are at least two possible bull counts:

1.  The current rally is a low degree fifth wave of a higher degree fifth wave.
2.  The current rally is a higher degree third wave of a higher degree fifth wave.

The first of those counts leads to a bit more rally, and then a stall and larger correction.  The second count leads to a relentless rally.  The first count could even be considered near-term bullish but bearish at larger degree (at least bearish for long enough to matter -- probably still unlikely to be "the end of the bull market" though).  The bear counts at this point are complex corrective waves that are intermediate bearish but long-term bullish.

In other words, because of what preceded the market's current position, we're wrestling with a high degree of interference noise in the charts right now, and we simply can't "wish it away," but must respect and work within the limitations it creates.

No change to SPX:


In conclusion, thanks to the sideways grind that began in 2018, there's too much interference noise this close to the range to sort these options out yet. Thus I'm contenting myself to attempt to deal with the near-term for now, and we'll build larger implicit structures if and when we can do so with more accuracy.  Trade safe.

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