SPX and INDU Updates: Still in the Channel

Last update outlined the next zones to watch, while noting that SPX had not broken any meaningful support levels.  And that remains the case.  SPX then spent most of last session bouncing sideways/up and looks poised to open this week higher.  The blue channel remains active for now.

INDU managed to rally back into the wedge -- if bulls can hold this, it would suggest more gas still in the tank for now.

In conclusion, so far bulls have held the levels they needed to hold -- and as long as they continue to do so, then there's still little for bears to get excited about.  Trade safe.

SPX and INDU Updates: The Small Correction Materializes; What to Watch Next

Last update concluded with:

"[T]he chances of at least a small correction are, if nothing else, higher than they've been in weeks."

And lo and behold, the market formed a small correction.  So I, again, just want to underscore that even as boring as this market has been for the past few months (and how bland the updates have sometimes been as a result), I am still paying close attention to the market's signals each time I publish an update.  

Now, whether this turns into a bigger correction or not is up to the market, but -- along those lines -- I'll outline a couple things to watch.

Let's start with SPX, which has so far only declined to the bottom of the blue channel.  Bears will need to sustain trade below that channel to get things going:

INDU reached and exceeded its first downside target:

In conclusion, due to the prior overlapping chop zone, there are still multiple ways to count the near-term waves -- so I'm keeping multiple options live in my mental tracking map, and trying to give manageable information without overwhelming readers.  The next key zones to watch have been outlined above, so for now we'll take it one day at a time.  Trade safe.

SPX and INDU: A Goofy Market

Last update noted a potential rising wedge in INDU and, well...

In SPX, the first meaningful support zone remains the lower blue channel boundary:

Note that SPX is reversing from the median blue resistance line, so this does have at least the potential to turn into a correction.  I have to admit, this is one of the goofiest markets I've seen in ~25+ years of trading, and it's hard to wrap one's head around that SPX is up nearly 2000 points just since April.  So my instinct is that this may indeed be the long-awaited high degree final extended fifth that I've talked about on and off since like 2017.  It's certainly been acting like the fifth wave extension of a fifth wave extension.

So, will the market form at least a small correction here?  Well, for once it's possible, which is something I don't think I've said for a few weeks.  So that's something and worth keeping an eye on.  But at the same time, given how goofy this market has been and how absolute muck the near-term pattern is, I wouldn't be surprised to see it rally right back up, either.  I guess that means the chances of at least a small correction are, if nothing else, higher than they've been in weeks.  We'll see how the market handles this.  Trade safe.

SPX and INDU Updates

The rally continued on Friday with no real changes, but an interesting near-term pattern has developed in INDU:

Bigger picture, nothing has changed.  SPX is bumping against possible centerline resistance:

Very long-term, we're still above the key breakout:

In conclusion, not much has changed in recent updates, but the near-term pattern in INDU could herald at least some near-term movement, we'll see.  Trade safe.

SPX Update: The Market as Trench Warfare

On Wednesday, the Fed cut rates by 25 basis points, as pretty much everyone expected they would.  The market initially dropped down to roughly test blue channel support -- the key support zone we've been watching since July -- which held.  It then rallied up to make another new ATH, then stalled and has gone sideways since.

Bigger picture, SPX still remains above key support:

And very long-term, I noted back in June that the market was entering "historically unprecedented" territory -- and it remains there for now:

In conclusion, it sometimes helps to think of the market as an analogy on "trench warfare."  Bulls have advanced and held the next key support lines (the trenches they now occupy) -- as long as they hold those, regardless of what happens in the near-term skirmishes, bulls are on the advance and not on the retreat.  It's worth noting that on the second chart in today's update, the upper red trendline is currently crossing the mid-7000s (meaning ~7500ish) and rising.  If bulls can continue to hold the key support zones, as noted on Sept. 10, that area becomes a possible next long-term target.  Trade safe.

SPX Update: Fed Day

Today is another Fed day, and everyone seems to be taking it for granted that the Fed will cut rates by at least 25 basis points, given the recent weak jobs report and the fact that Trump has threatened to inflict Jerome Powell with a brand new "even more demeaning" (per Reuters) nickname if rates remain steady.  Some contenders that have been suggested by Sources Familiar with the Matter are "Jerky Jerome" and "Poopy Pants Powell," but nothing official has been announced yet.

There hasn't been much to add to the charts in a while, and that's still more or less the case today.  Near-term, the blue channel is still the first zone bears would need:

Bigger picture, the dual support lines beneath the market are first meaningful support:

In conclusion, Fed days always present the possibility of something unexpected and/or a surprise reversal of market fortunes, so we should stay on our toes just in case.  The first key support zones at least appear to be fairly clear.  Trade safe.

SPX Update: Through the Inflection

SPX continues to move higher and this remains a "trend is your friend 'til the end" type of market, which means the only thing to do is watch key support zones -- and as long as those hold, then we assume the trend remains up.

I know it's not terribly exciting, but that's the ballgame during such times.  Right now, the chart below shows the lines that would be the first warning for bulls (if SPX were to sustain trade below blue/black).

Next is the old, and now reasonably well established, blue channel:

Finally, it's been a month now since I mentioned that ~9000 can't be ruled out at this point -- obviously nothing's changed there:

In conclusion, SPX has pushed through the prior inflection zone, so as long as bulls can hold this, it remains the bulls' world until proven otherwise.  Trade safe.