Monday, February 10, 2020

SPX and INDU: So far, so good

Last update went out on a limb and predicted that we were at the beginning of a new wave down (likely a large C-wave to completer a complex fourth).  Bears did briefly break their first key zones, but have not yet sustained those breakdowns.  They may do so today.

No change, and the all-time high is now the key zone bulls need to reclaim.  INDU broke its red trend line, and is testing the first blue line:

SPX briefly broke 3325, but closed just above it:

SPX has begun to whipsaw the red breakout, which is a good step for the bear case:

Finally, I don't know if I remembered to mention when SPX captured its downside target, which was the 50 day moving average (red 4 wave previously placed right at the spot where it bottomed), but this chart remains relevant because (if the C-wave decline idea is correct) it may now test the lower black trend channel or thereabouts:

In conclusion, no material change from last update.  There's simply no way to EVER say, "Oh, this is definitely 100% the correct prediction," but so far, everything is going the way bears need it to go.  We'll see if they can keep that up.  The first meaningful zone for bulls is the all-time high, though a brief break of the all-time high would NOT immediately negate the preferred count, sustained trade above the all time high would certainly cast it into doubt.  Unless that happens, or unless the market shows strong signs of bottoming, I'll continue to favor the C-wave decline as shown.  Trade safe.

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