Wednesday, April 17, 2024

SPX and BKX: SPX Captures Downside Target

Since last update, SPX captured its downside target of 5070-90 from April 12:

As we can see on the chart above, to complete C/3 down, bears would need another new low, which I'm currently inclined to suspect they'll get after a bounce.  That would complete red v, which would complete THREE waves down, so from there, a rally to new ATHs would not be off the table.  For bears to demonstrate more control, they would then need a bounce in a larger 4th wave, followed by another new low, at which point, we could conceivably label the entire wave off the ATH as an impulse.  The alternate bull count is that a WXY is complete/completing.  So, for now, bulls still have options in SPX.

BKX formed another low, which makes the decline appear reasonably impulsive -- although, to be completely objective, it would look a bit better at the micro level with one more low, so I can't be 100% on the "1" label just yet, though I'm leaning that way.

In conclusion, we have an apparent impulse down in BKX, but not yet in SPX.  One possible conclusion is that we're closing in on a trend change (BKX could bounce in wave 2 while SPX made another ATH, then the rug gets pulled).  That said, if SPX were to go on to form an impulsive decline (conditions for such outlined below the SPX chart) immediately, then, in that event, we would presume the trend had already changed at intermediate, and possibly long-term, degree.  Trade safe.

No comments:

Post a Comment