SPX, INDU, COMPQ: Inflection Point Arrives

 

Last update noted that as long as INDU held its key zone, there was no reason to get bearish, and the market has continued rallying since then.  Let's start with the most interesting chart:

SPX:

Finally, INDU actually stalled while COMPQ and SPX were rallying, but it's still above its first key trend line:

Last update's conclusion still holds: INDU remains our key chart at this juncture.  Basically, as long as the long-term blue trend line holds, then we can only favor the bulls for more upside.  Which is nice, because that makes things really simple right now.  In the event INDU sustains a breakdown there, then we have next levels to watch.  But if there's no breakdown, then there's just no reason to even consider bearish things unless or until there is. 

Near-term, COMPQ, at least, is into its upside inflection zone, which probably makes this an important moment for the rest of the market, too.  If COMPQ can sustain trade north of 24K, then that would be an all-clear for bulls for the immediate future.  If it gets rejected here, then near-term bear options will stay on the table.  Trade safe.

SPX, COMPQ, INDU: Provisional Targets

Not much happened on Friday, so let's revisit our big picture Rosetta Stone chart first.  I'm going to reprint Friday's notes about it, for anyone who missed last update:

INDU is once again trying to stay over its very long-term blue trend line.  Let's discuss both options:

1. If it CAN stay over blue, then bulls should get at least a few more weeks of happiness and possibly much more.  Bears will get another shot at upper red -- that will be an inflection (and if INDU sustains trade over red (a breakout would be expected either way; the question will be if it can hold it), then that's very bullish).

2. If blue fails, then bulls get another shot to hold support at black.  If black fails substantially, then we'll have to start looking at horizontal support zones (such as 45.7K) and things can get ugly fast.

Next up, we can now project provisional upside targets in COMPQ if it can sustain trade over its all-time high:

SPX's pattern doesn't allow clean targets like COMPQ, but we could expect it to behave similarly (i.e.- a decent rally over the coming weeks) if the COMPQ conditions are met:

In conclusion, INDU remains our key chart at this juncture.  Basically, as long as the long-term blue trend line holds, then we can only favor the bulls for more upside.  Which is nice, because that makes things really simple right now.  In the event INDU sustains a breakdown there, then we have next levels to watch.  But if there's no breakdown, then there's just no reason to even consider bearish things unless or until there is.  Trade safe.

SPX, COMPQ, INDU: One Chart to Rule Them All

Let's not keep everyone in suspense -- the clearest long-term chart right now seems to be INDU.  This is the exact same chart that, almost exactly two years ago, caused us to continue favoring a continuation of the bull market (bottom annotation from January 8, 2024). Now, INDU is once again trying to stay over its very long-term blue trend line.  Let's discuss both options:

1. If it CAN stay over blue, then bulls should get at least a few more weeks of happiness and possibly much more.  Bears will get another shot at upper red -- that will be an inflection (and if INDU sustains trade over red (a breakout would be expected either way; the question will be if it can hold it), then that's very bullish).

2. If blue fails, then bulls get another shot to hold support at black.  If black fails substantially, then we'll have to start looking at horizontal support zones (such as 45.7K) and things can get ugly fast.

Next up, SPX is back-testing the red wedge I drew a few weeks ago:

Same with COMPQ:

In conclusion, the simplest way to play this now is to treat 6789 SPX as key support.  Yes, there would still be the option of a WXY that bottoms not long after... but it might be worth just treating 6789 as key and then getting back into longs IF we see evidence of the WXY.  That's not trading advice, of course, but I'd recommend solid caution if SPX sustains trade south of 6789.  Because the expanded flat isn't a given, and particularly if INDU follows up with a sustained breakdown at black, the market has the potential to enter into a nasty correction.  

Of course, if there's no breakdown at blue, then bulls keep the ball. But I figured it best to lay out the implications, in case it fails. Trade safe.

SPX, INDU, COMPQ: And Then It Got Interesting

We've been watching the potential of a complex expanded flat since December 8, and that option just jumped itself back awake.

Now, it's NOT a "given" yet, but it's very much live at the moment.  There are basically two main options here: 

1. The complex flat

2. A b-wave high at lower degree

Option 2, the b-wave high, has a lot of leeway as to where it could bottom, if that's what we're looking at. In fact, it could bottom basically anywhere north of the November low.  Conversely, the complex flat (option 1) basically needs to at least test or break the November low.  Right now, it's hard to assign hard odds to which option's unfolding.  The next couple sessions will hopefully help clarify.

Next up, COMPQ came close to its target.  It's in a similar boat to SPX:

INDU has been stronger than either of these other two markets, and also has clearer near-term support lines:

In conclusion, we can't yet make the assumption that this is the complex flat -- the high is just too wonky for that clean a read.  But it's a live possibility, at least.  Hopefully the next couple sessions will help with assigning additional odds one way or the other.  Trade safe.

INDU, SPX, COMPQ: Stop with the Kicking

Once again, nothing much has happened since last update, which means nothing much has changed.

First chart up is INDU:

Next up: SPX.

And finally, COMPQ -- note that the aforementioned "ascending triangle" is NOT something I'm counting in Elliott terms.  I'm treating it as a classic TA ascending triangle.

In conclusion, there's just not much to add to anything I've said over the past two weeks now.  Trade safe, and have a great weekend.

SPX, INDU, COMPQ Updates: The Upside of a Boring Market

Rest assured: Eventually the market will get interesting again.

But right now, we're still stuck in the doldrums.  Nevertheless, I do have one interesting new chart for today, so let's lead with that:

INDU is unchanged:

SPX is unchanged:

While this market may seem boring, the absolute best thing we've done for the past couple of months is not chase patterns that aren't there.  And that's no small thing.  Because while a slow market is boring, at least it's not costly -- unless you run out of patience.  Trade safe.

SPX and INDU: The Bob Seger Market (Still the Same)

The big picture is unchanged since last update (of course), and was covered in detail there -- so if you missed that, it might be worth reviewing:  SPX and INDU Big Picture and Near-Term: Nearing the End of the Grind?

Near-term, not much has changed, either.  

SPX is still in a rising-wedge type pattern:

INDU is still near the upper boundary of its intermediate channel:

In conclusion, the market's been in a phase where little has changed recently, but we do have a pattern that continues to be worth keeping an eye on, with the wedge (potential diagonal or bull nest) in SPX.  Trade safe.

SPX and INDU Big Picture and Near-Term: Nearing the End of the Grind?

Last update covered the near-term options.  Until something big happens, there's just no change to the big picture.  

As a reminder, first near-term support is purple, then red:

 First meaningful intermediate term support comes at blue/black:

As long as those intermediate levels hold, SPX ~9000 will remain a live possibility:

Okay, back to the near- term.  INDU is near resistance:

And SPX is keeping open the option of an expended flat, with a potential ending diagonal forming near current levels.  IF this is an ending diagonal, there are currently enough waves up for it to be complete or nearly so.  First step for bears would be to sustain trade south of the red wedge.  Such a breakdown would NOT "guarantee" a diagonal -- it's simply the first hurdle bears would need to clear to even seriously consider a diagonal:

In conclusion, the market has been chewing sideways for months now and just hasn't been a great market for anyone trading shorter time frames.  We could be nearing the resolution of that soon (relatively speaking) though.  If this is a diagonal, it will make a quick trip back to the November lows; while, if this is a bull nest, it should start breaking out soon.  Either way, it may get interesting again.  Trade safe.

SPX and INDU: Some Near-term Charts

Last update focused on the big picture -- and no change there (as has been the case for many months now) -- so let's look at some near-term charts today.  

Starting with SPX:

Next, it's at least worth being aware of the approaching trend line in INDU:

In conclusion, SPX and INDU are both near overhead resistance, so that's worth keeping an eye on for the near-term.  There's another market I'm watching very closely here that's in the ballpark of an inflection zone, but I'm not going to bring that up unless it become relevant.  We'll see how the market reacts here -- but long-term, there's still nothing to indicate bears have come out of hibernation yet.  Trade safe.

SPX Update: Frozen Winter Market

Well, 2026 is upon us already, so Happy New Year to everyone.

Last update was just before Christmas.  On a closing basis, SPX has moved a grand total of 24 points since then.

It did manage to make a new high in-between, as expected, so that's nice.

As I ran through my chartbook tonight, all I could think was Gosh, what an exciting market. 

Given that the near term has been nothing but chop for a long time (as just illustrated), we're going to focus on the big picture today.

The first key chart remains the chart below.  As long as SPX keeps holding the blue and black breakouts, then bulls remain in charge:

The next chart shows why SPX has been stalled in this area: it's facing a long-term resistance trendline. So far, it's been bouncing around on either side of it, which isn't particularly revealing. If it can sustain trade above this, that would be a continued good sign for bulls:

In conclusion, it's genuinely impressive how little has happened in the past few weeks.  Old trader wisdom claims we should "never short a dull market"... so worth keeping that in mind.  Trade safe.

SPX Update: Merry Christmas to All, and to All a Good Night

Christmas week is upon us, which means that 2026 is just around the corner, which means we finally get the flying cars we were promised in 1980s sci-fi movies.  At least, that's what I'm hoping.  Given that we were basically promised those by the early 2000s, I feel like we've waited patiently for long enough now.  2026 will officially put as past the quarter century mark.  Which means: it's time.  I, for one, plan on writing my Congressional leaders to demand Flying Cars for 2026.  No more flimsy excuses and bureaucratic red tape!

Market-wise, last update noted that bears would need to sustain trade below 6720 to get things going, and so far, they've failed to do that -- meaning I don't need to change Friday's annotations:

Bigger picture... I basically never do this, but a reader called it to my attention that what I'd written on Friday's chart about "lower red" could mean a different red line than I had in mind, so I adjusted Friday's annotation in the interest of clarity:

In conclusion: Right now, there's nothing particularly bearish about the charts, but it's worth knowing that even if SPX makes a new all-time high soon, the complex expanded flat will remain an option for a time, until SPX sustains trade above the all-time high. Again, the complex flat (first chart) is not a prediction -- just an option the market can take if it wants to throw another curveball.

Wednesday is Christmas Eve, and as has been my long-standing policy, I'll be taking Christmas Eve though New Year's off from the updates (barring unusual circumstances, those are really the only days I usually take off for the entire year) to spend time with family.  Since Jan. 2 is a Friday and I have family on island from the mainland (through mid-January, actually), I'm going to take Jan. 2 off as well and the updates will return on Monday, Jan. 5.

Which means, this is where I wish all my readers a Merry Christmas and a safe and prosperous New Year.

It's also become a long-standing tradition to link to a nonmarket piece: A Christmas Story: Reflections on What Matters -- which, for those who haven't read it, is a memoir piece I penned (12 years ago now) about my mother's untimely death. 

Thanks for reading.  Thanks again to those of you who support this publication -- you are genuinely the ones keeping this whole thing going.  Have a pleasant holiday season -- and please drive, trade, and be safe.  Merry Christmas!

SPX Update: It's a Wonderful Knife

Christmas is almost upon us, which means that every time a Fed governor mentions the Fed's "tools," an angel gets its wings.  (This is, in fact, the reason why the quality of flying angels has fallen off so severely in recent years. The Fed has overused the word "tools" to the point that, by necessity, they're now handing out wings to anyone who's not visibly wielding a pitchfork.)

Chart-wise, SPX briefly broke its key lines, but recovered both quickly:

A wider view:

In conclusion, bulls can still recover it here and head to new highs -- but in the event SPX sustains trade below the recent low at 6720, then we'd watch the lower red channel boundary on the second chart while keeping the complex expanded flat from the first chart very much in mind.  Trade safe.

SPX Update: On the Nose

Since last update, SPX did what it was expected to do. I'd noted that if bulls couldn't recover red, it was likely to test purple -- and it tested it on the nose:

The purple trendline on the chart above roughly aligned with the near-term red horizontal I'd called attention to back on the 10th, which got tested in concert with purple:

SPX has bounced from these support zones, so bulls may be able to run it back up to a new high from here.  In the event they can't, then the falling blue line on the near-term chart would be the next zone to watch... and if that were to break down, then we'd have to keep the black complex expanded flat on the table.  Trade safe.

SPX Update: Two Weeks of Nothing

SPX has literally gone nowhere since the start of December, so we've had two weeks of running in circles and not much has changed:

On the intermediate chart, SPX did crack below the old red trend channel, so bulls would like to recover that ASAP:

In conclusion, there's just nothing to add when the market runs sideways for two straight weeks.  The only new observation worth making (additional to all the other observations I've already noted over the past two weeks) is that SPX is below red on the second chart.  If bulls can recover that directly, then nothing doing -- but if they can't and SPX sustains this breakdown, then we should keep an eye on the purple trendline next.  Trade safe.

SPX and INDU: INDU Confirms Prediction from Nov. 14

Since last update, SPX has done very little, leaving the outlook unchanged across the board here -- which is to say:

1. As long as key long-term support holds, no reason to be bearish (see this update for the most recent LT chart).

2. Near-term zones are as noted.

3. A complex expanded flat is always possible, but not necessarily probable.

Worth noting that INDU did finally confirm my read from November 14:

SPX has so far held its return into the red channel, testing it and bouncing higher.

Near-term support is unchanged:

In conclusion, to get even the near-term ball rolling, bears would need to break down out of the red channel from the middle chart.  If they did that, then we'd watch the next near term support zones -- and if those broke, then the complex expanded flat would be on the table.  Bigger picture, I'm still not seeing anything that makes me particularly bearish, especially as long as the key long-term breakout holds.  Trade safe.

SPX Update: Not Much to Add

The market hasn't done much this week, and recent updates have been pretty thorough, so there's not too much to add -- though I have highlighted some near-term zones worth keeping an eye on:

On the near-term chart, I point out a confluence (upper right red annotation) that's worth watching:

Not much else to add beyond that.  SPX always has the option to continue higher directly, but if it starts dropping, those are the first zones to watch.  Trade safe.

SPX and NYA Update: NYA Confirms Prediction from Nov. 14

Since last update, SPX inched higher, but the bigger news it that NYA made a new high, finally confirming my read from three weeks ago:

Nothing to add to the big picture SPX outlook:

Near-term, we should at least be aware of this possibility:

In conclusion, I do want to reiterate that the black lines on the final SPX chart are not a prediction, just an optional path the market could take.  If it avoids that path, then it will just continue higher directly.  Trade safe.

SPX Update: So Far, Just More of the Same

Not much has happened in terms of price since last update, but SPX has continued holding its key near-term support zones, which is bullish as long as it continues:

Intermediate term:

And long-term:

In conclusion, to reiterate my longer-term stance since September:  As long as SPX continues holding the breakout over blue and black in the long-term chart (final chart), there's just nothing for bears to get excited about, and the trend remains up.  For perspective, the ~9000 SPX target remains live as long as that breakout holds.  Trade safe.

SPX Update: Between a Rock and a Soft Place

The market's done essentially nothing since last update, so it's about time for my ~monthly reminder about the chart note (I don't even need to update the October annotation) from September:

Near-term, for smoothest sailing, bulls would like to continue holding above blue:

But really, the red line on this next chart is probably a bit more significant than the blue line on that near-term chart, though they're not too far apart:

So those are the near-term support zones -- meanwhile, what stalled the market here is the line that I called out last update:

In conclusion, SPX is paused between old long-term resistance and near-term support, so we'll see who blinks first.  Trade safe.