Wednesday, March 25, 2020

SPX, INDU, DAX: All Downside Targets Captured

Last update suggested lower prices were probably still needed, as has basically every update since the all-time-high... and each time, lower prices were reached.  1100 SPX points of profit is a heckuva few weeks!  Most would consider that to be a good few years.  Of course, it's never enough, and now everyone wants to know if the bottom is in.

Many are confidently proclaiming it is (how many of those folks caught the decline, I wonder?).  Many others are confidently proclaiming this is a bear market bounce (how many of THOSE folks caught the decline, I also wonder?).

Me?  Well, I'm confidently proclaiming that it's just not clear.  But I will say this:  For the first time since the crash began, there are at least enough waves that the bottom COULD be in.  Is it?  Don't know.  The easy money is over, at least for the moment.

But, again to reiterate:  It is at least POSSIBLE, for the first time (in my view), that the bottom is in.  So that's more hope than bulls have had in a while.

Let's look at some charts.  SPX may be the best intermediate chart if we want to simplify things as much as we can:

The SPX near-term chart has performed well:

Stockcharts was playing games with me again and refused to save my annotations (again), so I had to take a screenshot... but INDU ran to its first downside extension target, then bounced up to its first upside target, leaving it in a sort of near-term no-man's land for the moment:

Finally, bulls NEED to maintain a breakout in DAX to get things started.  So far they've only rallied back to the downtrend line:

In conclusion, for the first time since the crash began, it is at least POSSIBLE for the wave to be complete.  The low is a mess, though, so I can't say for certain that it actually is complete, because we could be dealing with a micro b-wave low.  I simply need to see a little more out of this current move to be more confident in either direction -- which (and I know it's hard to believe after hitting a big call like we just did) is sometimes just how the market is.  It's not predictable every second of every day, so we'll take things cautiously for the moment.  But again, bulls do at least have a chance here, for the first time in a long time.  Trade safe.

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