Wednesday, November 4, 2020

SPX Update: No Change, But One Additional Option to Consider

For the last few updates, I've suggested we would likely have a close and contested election, and that's exactly what we got.  That, of course, despite multiple polls having Biden up by double-digits (will anyone alive today ever fully trust political polls again?). 

I had hoped the market (at least) might resolve one way or the other, but it now appears the market is not surprised by this (the market is a better predictor than the polls; shocking!).  Since there's been no market resolution, there's likewise no change from last update, but I do have an additional option (which I've been considering for a few days, but which now seems possible enough to at least mention) to share.

First, the unchanged chart:

Below is an option I've been watching but waiting on... tonight's "non-reaction" makes it worth publishing now.

I'm not at all certain of the above, but we did appear to have three waves down from 3588 to 3209, then (potentially?) three up from 3209 to 3549, then a fairly clear three back down from 3549 to 3233 -- which is the correct structure for a larger triangle (each triangle wave breaks down into a corrective wave).

And with that, I'm going to take a week and a day off, and will return on November 16.  Unless I just can't stay away, which is entirely possible... but that's my plan at the moment.  If this ends up being the triangle, then it might work out well enough for all of us, we shall see.  Trade safe.

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