SPX Update: News Day Meets Inflection Zone

Last update concluded:

[I]f SPX rolls over here, the first zone to watch is 3865-98 (which would be one area a complex fourth wave could bottom), but it is into a zone where I can no longer promise continued upside. I think it would probably look a bit better with more upside, but it doesn't appear to be "guaranteed" the way it did over the recent past -- thus we'll be watching closely in the event it forms an impulsive decline.

And there's been no real change to that.  It is interesting that this apparent inflection arrived when it did, since today we have a number of potential market-movers:

• Powell speech
• Pending home sales
• Oil inventories
• JOLTS
• PMI
• FOMC Beige Book
• GDP
• ADP

I think my idealized scenario would involve some whipsaws before it really gets rolling, but we are into the blue 2 inflection zone -- and it's not supposed to be easy here:

In conclusion, I think it's wise for bulls to remain on alert right now, because, as I noted last update, there is the possibility for ALL OF blue 2 to finally be complete, or nearly so.  Trade safe.

SPX and TLT Updates

On November 18, I wrote that "the last dip was probably just another corrective fourth wave," and that read has finally been confirmed by SPX reclaiming its most recent high.  Things are getting a little more complicated now, as some of the more "obvious" needed fourth waves have now potentially resolved, and fourth waves are notoriously complex to begin with.  For example, one option is for SPX to form a complex fourth right now, by heading back below 3906.  

It would probably still look better with higher prices, but we're now into territory where we have to at least consider the option that it's "done enough" fourth waves and reverses more significantly.  In other words, I'm not calling the top yet, but it's at least on the table finally and I can't rule it out anymore.  However, I'd still like to see an impulsive decline before considering that option in more detail, so the big picture chart remains unchanged for now.

TLT has rallied ever since my warning (which turned out to be the exact bottom), but is now testing an area that could potentially offer resistance, and is thus worth watching more closely again:

In conclusion, if SPX rolls over here, the first zone to watch is 3865-98 (which would be one area a complex fourth wave could bottom), but it is into a zone where I can no longer promise continued upside.  I think it would probably look a bit better with more upside, but it doesn't appear to be "guaranteed" the way it did over the recent past -- thus we'll be watching closely in the event it forms an impulsive decline.  Trade safe.

SPX and BKX Updates: Torquey Turnkey Turkey

On November 18, I wrote:

As of this instant, we still do not have an impulsive decline, and it does appear that the last dip was probably just another corrective fourth wave. So for now, we're just going to focus on the big picture:

And since then, the market has continued in a sideways/up grind, so no change yet, and we're going to continue focusing on the big picture, along with an additional chart.  First up is SPX, which is unchanged:

Next is BKX, which, in classic technical analysis, would have a bullish appearance if it can sustain a breakout over the black line:

If BKX sustains a breakout, that would (again, traditionally) imply a move toward "or 4?"  Which, in turn, would imply SPX may well be headed toward the higher red "or 2."  Of course, BKX does need to sustain a breakout first, but if it does, it would call for continued bear caution.

Not much to add beyond that, except to mention that tomorrow is Thanksgiving.  My in-laws will be on-island for the holiday, and Friday is a short (and typically light-volume) session anyway, so I'm going to take a (I believe!) well-deserved day off on Friday.  Happy Thanksgiving to everyone!  And trade safe.

SPX and COMPQ Updates

The market did basically nothing on Friday, so the very short-term is now even more of an overlapping mess, thus giving no new clues and leaving us in basically the same place we were on Friday.  In other words, we'll continue focusing on the big picture until the short-term clarifies a bit.

I did want to note that COMPQ is back to intermediate resistance, so while there's still nothing that suggests we've changed the near-term trend (yet), this is still an area of interest.

In conclusion, nothing much to add to the past couple updates.  Trade safe.

SPX Update: Keeping It Simple

Last update discussed that the market seemed to have completed several fourth waves recently and noted:  

All this implies that the market might be unwinding its upward momentum, meaning the rally might be getting a little tired. I say "might be" because this is the type of market that can easily find a second wind and burn bears who get too aggressive too early, so I'm not inclined to get too far ahead of it... but it's interesting to note that we are approaching the blue 2 zone (chart below). 

That said, it's quite possible that if there is a reversal, it will just be a correction on the way to red "or 2," so I'm awaiting an impulsive decline before actually changing footing. As of this exact instant, this is more of a "time to be cautious" moment for bulls, as opposed to a "bet the farm short" moment for bears. It could always turn into one, but we don't have an impulsive decline yet.

As of this instant, we still do not have an impulsive decline, and it does appear that the last dip was probably just another corrective fourth wave.  So for now, we're just going to focus on the big picture:

In conclusion, the next real test for bulls will come near the downsloping red trend line and blue 2.  Until then, bears would need to sustain a breakdown of the rising black channel to get anything started.  Trade safe.

SPX and BKX Update: "Easy as Cake"

 Last update predicted:

the SPX 24 hour chart (ES+SPX) appears to be three waves up into its high, which suggests that either the rally since 3941 (on that chart) is incomplete to the upside, or that the larger wave (going back to the start of the rally) is incomplete to the upside. In other words, this chart seems to suggest more upside either now or later.

And then later underscored:

let's not get too far ahead of the market yet, as the SPX24 chart (second chart) seems to suggest we're not quite to the bigger B/2 just yet

This read was quickly vindicated by the market, which made new highs later that session.  This implies that the correction discussed above was a fourth wave (at micro degree) and that the new high was a fifth wave, with another fourth seeming to play out in the latter part of the session on the 14th, with the fifth to pair with that second fourth ("second fourth" is fun language) showing up in the gap up yesterday.  We may have then seen yet another fourth wave (a "third fourth"!) manifest in the remainder of the session yesterday.

All this implies that the market might be unwinding its upward momentum, meaning the rally might be getting a little tired.  I say "might be" because this is the type of market that can easily find a second wind and burn bears who get too aggressive too early, so I'm not inclined to get too far ahead of it... but it's interesting to note that we are approaching the blue 2 zone (chart below).  

That said, it's quite possible that if there is a reversal, it will just be a correction on the way to red "or 2," so I'm awaiting an impulsive decline before actually changing footing.  As of this exact instant, this is more of a "time to be cautious" moment for bulls, as opposed to a "bet the farm short" moment for bears.  It could always turn into one, but we don't have an impulsive decline yet.

BKX, of course, decided to get cute and goofy and whipsaw its breakout, so it's not unreasonable to think it's still headed higher, and we can definitely say that "or 4" isn't a given yet:

In conclusion, SPX has spent the last few sessions lunging briefly higher, but then failing to find additional buyers, so while there's nothing yet to suggest a reversal, bulls may want to at least lean forward in their chairs a bit and watch things closely over the next couple sessions.  Trade safe.

SPX Update: Increasingly Messy Market

Since last update, the market continued rallying, but now INDU has reached the first "5?" on its chart:

If SPX doesn't resume rallying directly, the first meaningful zone to watch for possible support is probably 3905-3925... I mention this zone because the SPX 24 hour chart (ES+SPX) appears to be three waves up into its high, which suggests that either the rally since 3941 (on that chart) is incomplete to the upside, or that the larger wave (going back to the start of the rally) is incomplete to the upside.  In other words, this chart seems to suggest more upside either now or later.

That said, this chart (below), which I haven't updated since November 2 and intentionally haven't updated today, is interesting and shows the market tagged resistance at Friday's high:

In conclusion, if SPX cannot get back above 3990 fairly quickly, it does have options for a correction toward the 3930s, then the aforementioned 3905-25 zone.  If that zone fails, there are several smaller potential support zones below it (3886-96; 3861-74; I won't list them all here), but the bigger B/2 correction shown on the old non-updated chart (final chart) would then at least be on the table, too.  However, let's not get too far ahead of the market yet, as the SPX24 chart (second chart) seems to suggest we're not quite to the bigger B/2 just yet -- though this pattern has grown increasingly messy in recent days, so we'll take it as it comes.  Trade safe.