$SPX Evening Update

If we get a plunge for the NFP and take out the 3670 level with any conviction, I will adopt this bearish count:

SPX

It has us in the 5th primary (pink) wave of cycle (yellow) “c.” If we do plunge and eventually take out the recent low, I will expect this 5th pink wave to be extended. One reason is because I know that basically everyone is expecting this:

SPX

But there is no good fib there to justify the count as complete just below the recent lows, though there is further down at 3400 (and there’s another one even below that, but I’m not sure if we’ll need that one). We remain in a nice channel (parallel red rails). And the pink 4 (or what I think is pink 4) poked it, which would be normal.

Zooming in, it is difficult to count today’s slop as the beginning of a decline, but with some care, it can be done:

SPX

So, if we do get a gap down, it is possible that we’re in green 3 of orange 1, etc. If things don’t look that bad, then I will consider some other options. I prefer this for the moment given the dollar’s strength today, the continued position of the VIX in a bull flag, etc.


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