Friday, July 5, 2024

SPX and COMPQ: No Surprises

SPX continued rallying on Wednesday, bringing the pattern I thought I was seeing (originally on June 24) to a more satisfying fruition.

Since the chart above references COMPQ, let's look at that chart before we talk further:

What we see on both charts is three waves up (so far) off the recent lows, which suggests that this is (most likely) not yet a complete rally wave.  An alternate potential to remain aware of (for the next session or two, anyway) is for those three waves to mark yet another b-wave high, which would reverse back toward the right-most "IV?" on the COMPQ chart, before rallying again.  Given the strength of the rally so far, that seems less likely, but it is still technically possible.

In conclusion, thankfully, no surprises over the past two weeks, so we were able to avoid bull and bear traps during the sideways mess.  At this point, it appears to remain bulls' ball, for now, with at least one micro fourth and fifth probably still needed, possibly two.  Again, though, once V finally completes, there is potential for a larger correction -- though I do still continue to advocate awaiting an impulsive decline as opposed to trying to front-run this wave.  Trade safe.

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