SPX Update

On Wednesday, SPX back-tested its breakout over the red trend line that I mentioned last month:

That red trend line has shown itself to be near-term support so far.  Next overhead resistance is still 4326.  And while one can never comfortably assume that resistance will fail (or that support will hold), if SPX is to reach the common C=A outcome, then it would still need higher prices.  Thus the near-term outlook is unchanged. 

In conclusion, bulls still need to claim horizontal resistance (4326), but so far, anyway, SPX appears to be on track to do that.  Of course, if bears were to whipsaw the recent breakout with authority, then they would gain more near-term hopes.  Trade safe.

SPX and COMPQ: What's Old is New Again

You know you're dealing with an exciting market when the most recent annotation you wrote on a specific chart was 11 months ago -- but that annotation remains relevant almost a year later.

No real change since Monday's update.  A reminder that Blue 2 would be off the table north of 4326 -- and that the horizontal zone around 4326 is potential resistance.

In conclusion, this market is rather unique, at least to most people who are trading today.  We certainly haven't seen anything like this in decades.  I started trading in the 1990s, and I've seen bull moves, bear moves, and sideways grinds -- but during that time, I can't recall a market that spent a full year going nowhere, as this one has.  Hopefully, it will also be the last market we see like this for the next 25-30 years.  Trade safe.

SPX and NYA: Finally, Something to Talk About

After a big day on Friday, we finally have a market move worth discussing.  Let's start with NYA before SPX:

Next, let me reprint something from a couple weeks ago, because it remains relevant:

This lag suggests two diametrically opposed possibilities: Either SPX only has a little more upside, and the rest of the market will drag it back down -- or SPX is headed toward at least Red 2 and that will drag the rest of the market up. NYA may become particularly germane here -- IF it can break above the red c/3 high, as it would then need to go on to form 5 waves from the 15055 low. Right now, because of the divergences across markets, it's a bit early to determine how significant SPX's breakout may or may not be, so how these markets collectively behave during the upcoming sessions will be important toward drawing firmer conclusions one way or the other about the larger time frames. 

 

Finally, the big picture chart again, to put it all into perspective:  Above 4326 and Blue 2 would finally be off the table, leaving Red 2 as the main bear option:

In conclusion, Friday's move has finally put bears into a "do or die" with blue 2, given the proximity to 4326.  The second chart already hints at Red 2 as a distinct possibility, but let's see if bears have anything up their sleeves at horizontal resistance.  Trade safe.

NYA Update: Jerome Powell EXPLODES in Fiery Blast

If you've ever read the "financial" media (or really, any media), you know that one of their tricks to keep us interested is to use hyperbole a LOT.  So you see a lot of headlines that either scream that it's the end of the world or that the market is going to the moon.  What you don't see are a lot of pieces like the pieces I've been writing for the past couple months, which boil down to "nothing to see yet."  So I apologize if these have been boring, but I prefer what I view as the "boring truth" to an exciting lie.

Nothing has changed from the past few updates, NYA is still severely lagging SPX (if need be, reread the past few updates to see what that means):

So, still nothing to add, unfortunately.  Other than, of course, the news that JEROME POWELL EXPLODES!!!  Which probably didn't happen.  (Though, to be fair, I haven't seen any reports denying this, either.)

When something does happen, which it eventually will (I think), then we'll finally have something to talk about again.

Trade safe.

SPX and NYA: Two Interesting Ancient Charts

 Let's start off with a look at NYA, which continues to lag severely:

Next, a reminder of my current near-term view, which is unchanged since last week:

This lag suggests two diametrically opposed possibilities: Either SPX only has a little more upside, and the rest of the market will drag it back down -- or SPX is headed toward at least Red 2 and that will drag the rest of the market up. NYA may become particularly germane here -- IF it can break above the red c/3 high, as it would then need to go on to form 5 waves from the 15055 low. Right now, because of the divergences across markets, it's a bit early to determine how significant SPX's breakout may or may not be, so how these markets collectively behave during the upcoming sessions will be important toward drawing firmer conclusions one way or the other about the larger time frames.

Next up, there is potential intermediate resistance overhead in SPX on two different scales, the first of which is shown below:

Long-term resistance shows on the next chart as well -- which also happens to be a crazy projection chart I drew more than a year ago.  I haven't moved anything on this chart since then:

In conclusion, NYA continues to want to try to pull SPX down.  SPX is also facing overhead resistance, which just happens to roughly line up with a chart I drew before the bear market was even being called a "bear market" by the masses.  So, it will be interesting to see if we're getting into the ballpark of a turn, or not.  Trade safe.

NYA Update: First target captured, and a look at the most interesting chart

Last update called out SPX 4100-11 as the next zone to watch, and SPX declined to 4103 and found support in that first target zone.  As noted last update, if SPX can sustain a breakdown below the first zone, then 4040-51 becomes the next zone to watch.

Since SPX is back into a congestion zone, NYA is far more interesting:

As we can see, NYA has now overlapped the 1/a high, which means that we are likely looking at a 3-wave rally on the heels of the long-presumed impulsive decline (the red 12345 back in March).  As long as bears can hold that c/3 high, then things look promising for them.

Other than that, nothing to add to the past couple updates.  Trade safe.

SPX, INDU, NYA: Revenge of the Lag

On Friday (and reiterated on Monday), I noted that INDU and NYA were both severely lagging SPX, and wrote:

This lag suggests two diametrically opposed possibilities: Either SPX only has a little more upside, and the rest of the market will drag it back down -- or SPX is headed toward at least Red 2 and that will drag the rest of the market up. NYA may become particularly germane here -- IF it can break above the red c/3 high, as it would then need to go on to form 5 waves from the 15055 low. Right now, because of the divergences across markets, it's a bit early to determine how significant SPX's breakout may or may not be, so how these markets collectively behave during the upcoming sessions will be important toward drawing firmer conclusions one way or the other about the larger time frames.

After Friday's update was published, SPX ran a little higher, then stalled, and it has since reversed lower.  This is (so far) in keeping with the first possibility discussed on Friday (above).

The next zones to watch in SPX are 4100-11, and, if SPX sustains trade below the first zone, 4040-51.

We can see on INDU that a sustained breakdown would suggest some downside follow through:

NYA is in a similar position:

NYA's bigger picture chart is still unchanged:

In conclusion, this is why I warned on Friday and Monday not to read too much into the breakout in SPX -- but by the same token, as of yet, we can't read too much into downward options, either.  We're still range-bound, but based on INDU and NYA, it seems reasonably likely we'll see at least some near-term downside follow-through if there's a sustained breakdown of recent lows.  And, if nothing else, this reversal is obviously preferrable for bears than the alternative.  Trade safe.