Friday, January 29, 2021

SPX Update: No Surprise

Last update noted that a five wave rally at larger degree had likely completed and thus that we could expect a larger correction in either the lingering potential for a (gray) 4, or worse, and the market obliged.  

In the forums on Wednesday, I noted that if SPX bounced from Wednesday's low, we would likely run up north of 3810 before declining back to new lows (as the low would appear to be wave b of an expanded flat).  On Thursday, I then called out the price zone in real time (3825-30) -- and the market topped there and appears on its way to confirming the read that the low was indeed the b-wave of an expanded flat.  (Do note that the screwy thing is that SPX only needs to break 3767 to resolve that pattern in a technical sense.)

Bigger picture, the question is whether this is gray 4 or we've seen ALL OF 5.  I'm leaning toward all of 5 having completed, but it's just a very slight lean at this point.  Do note that if ALL OF 5 has completed, we may have just seen the completion of Cycle 5 and thus a SuperCycle top (a massive, generational top that could take SPX back into triple digits)... but again, first things first and I'm not quite ready to declare that with any conviction yet.  For one, we still have only three waves down from the ATH... and if the next wave completes by breaking 3767, but shy of Wednesday's low, it will make my work more difficult.

In conclusion, SPX continues to follow the recent projections, and we'll await its next move before getting too hung up on the very long-term picture.  Trade safe.

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