$SPX Update

Looking at the second thought from this morning, it’s looking more like a larger 3-wave move, which, if we’re bullish enough to go on to make another higher high, can make this a “flat” correction for “blue b” (a 3-3-5) pullback:


If it is a flat, orange b can go almost anywhere it wants to, either here at the 61.8% retracement, or even above the high at blue a, making an expanded flat. No good way to tell unless you’re friends with a big fund manager and can ask him what his intentions are here. But, this 61.8% is one place it can stop—though, it’s still possible to go to 4002, 4028, or perhaps even a little higher.

Now, the more bearish alternative is that the high of the (presumed) bear market rally is already in, and the orange a-b-c is not part of blue b, but rather the beginnings of a much deeper decline. We can resume the bear market in a corrective wave (down), and in fact, almost every decline all year has been “corrective.” It would be easier to count if it were an impulse wave, but maybe we don’t get that. No way to predict that.

So, let’s see what happens, but so far at least, I continue to be inclined to look for another drop of some kind.

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