Wednesday, September 29, 2021

SPX Update: So Far, So Good

On September 24, I highlighted the potentially-complete three-wave rally to 4465 and explained that level could be for "All the Marbles"

SPX ended up staging a strong rally from the ~4300 support zone, but has so far only rallied in three waves. The next few sessions may thus end up being for all the marbles.

We now know that inflection zone was correctly identified, as SPX held that zone and sold off hard yesterday.  This is something we haven't seen too often since March 2020:  A V-bottom that sees a subsequent strong sell-off.  This suggests a potential change of character for the market -- and while not "confirmed" yet, this is in line with our suspicions.

Bigger picture:

In conclusion, if SPX breaks the 4305 low, the alternate bull count will become harder to defend.  Bulls will still have the option of a large flat, as noted, but it will be as close as we can get to early "confirmation" of the larger suspected bear move.  Trade safe.

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