SPX Update: Inflection Point

Last update discussed the possibility of a top nearby, but with two caveats (quoted below):

1.  "The main question now will be an option that I raised on our forums on Monday, and that's for a more complex "double retrace" correction prior to the next leg down." 

2.  "On the one hand, I like the idea of the market trapping bulls near yesterday's high before embarking on a more serious decline, but on the other, I'm never a fan of "bad news" market tops and vastly prefer significant tops to occur on "no news" or good news.  Consequently, I'm only slightly favoring the blue path over the black path."

It's worth noting that the e-mini S&P futures (symbol: ES) will have completed that discussed double-retrace, although this isn't entirely apparent on the cash charts.  In a perfect world, today's open is where bears will make a stand.  If they can't, then we have to consider the possibility that we run toward the Blue C target more directly:

(PLEASE NOTE TYPO:  2990 should read as 2790!)

In conclusion, a gap up open that reverses soon thereafter would be exactly what bears want to see here.  If we instead "gap and go" (keep running strongly), then bears will want to be cautious, as such a move could signal a run toward 2825-60.  Trade safe.