Market Update for Thursday, August 31st, 2023

Good afternoon, traders.

The S&P 500 is consolidating underneath this channel from which it fell, after it returned to it for a retest:

I did not get my preferred “ending diagonal triangle” which left the other option discussed yesterday.

There are two ways we may view the very local price action. The first way is as a little head and shoulders pattern:

If this breaks down, a top of some kind may be in place.

The disadvantage to this interpretation is the “wall into the close.” These can sometimes be reversed by the following open. And if we do that, this little poke below the neckline is not going to stick.

The second way we may interpret this price action is by placing it into a kind of triangle, like this:

This can lead to continuation.

So, we will have to see. But, these two interpretations lead to two different counts, both of course of which I do think will head in the same direction eventually:

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I hope everyone has a wonderful evening. And I think some very interesting times are nearly upon us! I look forward to seeing you tomorrow.