Yesterday, SPX traded in a circle, as we can see on this actual to-scale line chart of Thursday's price action:
Ha ha, just a little trading range humor there, designed to elicit angry responses from CNN's "fact-check" team.
In reality, the market wasn't nearly that interesting, and confined itself to a much smaller range than shown on that chart.
On a more serious note, when I look across markets, I'm still struck by how many remain below their June swing high. INDU (as noted previously), but also TRAN, NYA, and others. I think unless/until bulls can claim those highs convincingly, the option of a b-wave high/c-wave decline (as discussed last update) has to remain on the table:
Of course, if bulls CAN claim those highs convincingly, then (as also discussed previously), bears would need to be cautious due to bull nest potential.
In conclusion, the market appears to be fairly bimodal here. Either it's in the process of forming a B-wave top to be followed by a rapid C-wave decline toward red (now gray) (2) on the chart above, or it's gearing up for a sustained launch in a third wave rally. The first step for bulls is to form a convincing breakout, which they haven't been able to do yet. First step for bears is to hold the aforementioned zones and start to break some near-term support levels (Thursday's low would be a start, for example). Trade safe.
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