SPX Update: 9-26-11

The market rallied today, right into our target range of 1155-1170, as we projected in the Weekend Update -- despite Dennis Miller's continued insistence that the market would decline because it was "acting worse than Kim Cattrall in Big Trouble in Little China."

The corrective movement of the rally is making the squiggles a bit difficult to label, but it looks like it may actually be targeting the gap fill at 1182.  As I said, though, it is difficult to count.  The rally has fulfilled its minimum requirements, so it is our view that the rally could end any time between now and 1182.   

After this rally ends, we should move down to at least test the 1101 low.  Sustained trade below 1150 should indicate that the move to 1101 and beyond is underway.  As the wave unfolds, we will start to get some indications, based on the form it takes, as to whether the market will make an ending diagonal or continue down toward SPX 1000.  I have updated the chart to reflect both possibilities, and I will keep you posted as the waves start to clarify which route the market has chosen.