Friday, April 24, 2020

SPX Update: The Next Key Levels

Last update, SPX had arrived at the inflection zone that arrives with three wave declines, and I noted that

While the market was heartily rejected at that resistance zone, as of yet, there is still no impulsive decline to add confidence to the bear view, though -- so we're watching to see if one develops.

and concluded with:

Ideally, bears can keep pushing a little further and form an impulsive decline. 

The decline then stalled right at that inflection -- so, thus far, bears haven't been able to get it done, and the pattern got, and remains, stuck at three waves down.  Today might therefore be critical.

The three wave structure is pretty clear on the 5-minute chart, but the rejection at red is worth noting:

Bigger picture, the blue path remains speculative -- and until bears can break 2727, there's still no impulsive decline to give it any more weight.

No change at the higher wave degree:

In conclusion, today could be a pivotal day, in a "make or break" way for the near-term bear options.  As noted, bears do need to sustain a break at 2727, but if they can, then that would clear them for a decent near-term run lower.  On the flip side, if bulls were to sustain trade over 2882 resistance, then they could make a run toward 2950-3000 next.  I'm still leaning slightly toward the bears (near-term) here, but the wave pattern has thus far refused to add confidence to my lean, so we'll simply have to stay nimble and see how it plays from here.  Trade safe.

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