SPX, TRAN, COMPQ: On the Line

Since last update, the market has continued to struggle, and made another new low on Monday.  It bounced Tuesday, but has already tested Monday's low in the overnight.  I've made it no secret that I am bearish until proven otherwise at this juncture -- but today we're going to revisit three very long-term charts, which show a consistency that may be "as clear as this game ever gets."

Let's start with the SPX chart we just looked at:

TRAN shows itself in a similar position:

Now let's add the "NasDuck" Composite (COMPQ) to the mix (typo on the chart: "continued" was supposed to be "continues," present tense):

So we appear to have something of a consensus among these different markets.  All are testing their long-term breakouts.  All would qualify as whipsaws if those breakouts fail (by more than a smidgen).  Whipsaws typically lead to above-average moves in the opposite direction.

So:  If you're still bullish, you could view them as "testing support" -- but watch out if that support fails.  The bull case will be much harder to defend if (or, in my opinion: "when," but I could always be wrong) that happens.

Near-term, not much change.  The market still has the option of complex second waves.  All paths ultimately lead lower:

In conclusion, multiple markets are testing their long-term breakouts.  I continue to suspect those tests will ultimately fail, leading to significant sell-offs.  Trade safe.

SPX Update: Reviving an Old Chart

On Friday, SPX broke its prior low, which now definitively confirms the ABC count posted on Sept. 24.  It then bounced hard, which was in line with both the options we've been tracking/anticipating:

On the chart above, do keep in mind that if we are entering iii of 3 down, it will be an ugly and relentless decline until it runs its course.

Stepping back a bit, there are some trend lines at/just above Friday's high that bulls will need to reclaim.  The first is the median channel line on the hourly chart: 

The second can be seen on the very-long-term chart:

The VLT chart above also may represent some form of "hope" for bulls, in that SPX still hasn't broken below the old red trend line.  In fact, it tested that line at Friday's low and bounced, so if one is still bullishly inclined, that may be the next line to trade against.  If there's a sustained break below red, then the green trend line will probably be tested.  And as I said previously, it's a bit early to say with 100% certainty that the bull is over -- I do continue to suspect that it is (at least for the foreseeable future), but I've been around long enough to know that, as Spock used to say, "there are always possibilities," my own inclinations notwithstanding.  Trade safe.

SPX, TLT, TRAN Updates

On September 27, I suggested the possibility of a 3-3-5 flat that would retest the 4305 zone before bouncing back up.  Yesterday culminated with a perfect test of the low.  We'll discuss that further in a moment, but first, let's take a quick look at this unique, high-tech interactive chart that visually depicts the market's price action from the past couple weeks:

All kidding aside, it's interesting to note that ES (e-mini S&P futures) made a new low in the overnight session, which suggests that even if bulls do get a bounce here, we're probably all-but destined to head back to this low (as the 3-3-5 count suggested all along):

Near term chart:

Bonus TRAN update:

And TLT update:

In conclusion, everything continues to break the right way for bears.  While we still can't entirely rule bulls out, this is about "as good as it gets" for bears at this stage, and the question seems to continue to be "down now or down later."  Trade safe.

SPX Update: So Far, So Good

On September 24, I highlighted the potentially-complete three-wave rally to 4465 and explained that level could be for "All the Marbles"

SPX ended up staging a strong rally from the ~4300 support zone, but has so far only rallied in three waves. The next few sessions may thus end up being for all the marbles.

We now know that inflection zone was correctly identified, as SPX held that zone and sold off hard yesterday.  This is something we haven't seen too often since March 2020:  A V-bottom that sees a subsequent strong sell-off.  This suggests a potential change of character for the market -- and while not "confirmed" yet, this is in line with our suspicions.

Bigger picture:

In conclusion, if SPX breaks the 4305 low, the alternate bull count will become harder to defend.  Bulls will still have the option of a large flat, as noted, but it will be as close as we can get to early "confirmation" of the larger suspected bear move.  Trade safe.

SPX Update

Not much happened on Friday, with the market spending most of the day range-bound, so there's little to glean from that.  Futures made a new high in the overnight, but cash is ultimately king.

Nothing new on the intermediate term chart:

In conclusion, we're in much the same place we were Friday, with the addition of the knowledge that ES futures made a new high -- and that might give bears at least some cause for caution.  That said, cash matters more than futures, so we'll see how the market reacts today.  Trade safe.

SPX Update: All the Marbles?

SPX ended up staging a strong rally from the ~4300 support zone, but has so far only rallied in three waves.  The next few sessions may thus end up being for all the marbles.  

Rejected at the red upper channel boundary on the larger chart:

In conclusion, the charts say it all, and "the fate of the free world" may hinge on the next few sessions.  Trade safe.

SPX Update: No Material Change

 So far, nothing to add to last update, except to update the charts:

Closer view:

In conclusion, no material change from last update -- so far, anyway.  For information sake:  If bulls were to sustain trade above the 4450 zone, it might get a little tougher.  Trade safe.