SPX, BKX, COMPQ, NYA: Next Zones to Watch

This update is better explained with charts than with words, I think, so let's jump right into it.

First up is BKX:

COMPQ was rejected right at the previously discussed blue trendline:

Next is NYA, which also shows a clear "three up" (three up is the inflection zone for a corrective ABC rally) so far:

Big picture, SPX ran a bit past the original upside target zone, but fell short of the next one (so far):

Near-term, I've noted some zones to keep an eye on:

In conclusion, last update noted that the market could have a near-term reaction here, and it did.  At this point, it's quite clear what bulls need to do and where bears might want to step aside (yesterday's high) -- and while it's not quite as crystal-clear what bears need to do (there are zones, but no "hundred-percenters"), it is worth noting that they haven't done any of it yet.  Trade safe.  

SPX, BKX, NYA: SPX ~3900 Hit

Last update noted that bears might want to show caution and called out SPX ~3900 as the next zone we'd be watching -- and SPX got there before the close of the session.  This is the first test bulls face, so we'll see how the market handles it -- but if bulls sustain a breakout here, then it would call for bears to continue to show caution and patience.

BKX rallied up to red (iv) from last update:

NYA's whipsaw was indeed a near-term warning signal:

Also, I mentioned a few days back that I was working on a longer piece, but I've decided to hold off for a minute on publishing it.  The piece was a bit of an off-the-cuff analysis on current market sentiment (which, as I've discussed, seems to consist of people who say they're bearish but are invested as if they're bullish) -- so if you asked me why I've decided to hold off, I'd say because I actually want to see a larger rally here (and my gut says that may happen) and for people to really think the "bull party" is back in full swing... at which point I will then publish the piece discussing why I think they're wrong.  It's the contrarian in me (grin).  

Anyway, in conclusion, this is a test for the market, and while there's no particular chart or fundamental that grabs me at this juncture, as I mentioned above, my gut says there's a decent chance for a larger rally here... so we'll see how the market reacts to the test of resistance, but if it starts clearing resistance zones, then I do think bears should be careful (for the time being).  If it doesn't clear, then maybe bears are still in near-term business (and SPX may react to this zone, which is presumed resistance, in either case).  Trade safe.

SPX, BKX, COMPQ: Picking Nits

The price action of the past few days suggests bulls are trying to put in a bottom of sorts, the question is whether this is just going to be a micro fourth wave, or the start of something more significant.  In today's update, we'll look at the next upside zones that may help answer that question.

Let's start with SPX:

BKX helps put the chart above into more perspective -- we can presume either BKX/SPX are working on micro red (iv), or are trying to mount a larger bounce in 2 (or a more complex larger 4 -- not functionally much different at this stage):

NYA has whipsawed its breakdown:

COMPQ is bouncing from its 50 month MA, a possibility we were alert to earlier:

A different look at COMPQ:

In conclusion, the ingredients are finally at least present for a larger bounce if bulls can clear the next upside resistance zones.  We're into the "picking nits" part of Elliott Wave analysis, where the easy money for the move (at least, for this leg of it) has already been made.  At this point, the structure could "possibly" support one more micro fifth wave lower -- but zoomed out at the larger time frames, it already has enough waves to call it "five down."  Which means this is certainly an area where bears might finally want to show some caution.  The next zone we'll be watching is the 3900+ area on SPX.  Trade safe.

SPX Update: One Chart to Rule Them All

Well, I have begun a longer piece, but I can already tell I'm not going to finish it in time, so this is the abridged version.  With any luck, I'll complete the longer piece for Friday or Monday.  The only thing about that is that the chart below (SPX, not BKX; second chart) inspired the longer piece, so it feels a bit naked without it, but I suppose I can always publish the chart again.  So let's start here:

The near-term charts are a bit mixed:  Some seem to suggest we may be closing in on a bounce, others seem to suggest waterfall potential; if we refer to the BKX chart below, this dichotomy makes some sense, as we appear to be in a fifth wave, and fifth waves are the final waves that complete a larger structure, thus they tend to suggest a bottom of sorts is near... but if they extend, then they waterfall.  

Presumably, SPX and BKX will track reasonably closely in structure over the next few sessions.  Personally, I'd like to see a standard fifth here (not a waterfall extension) to relieve some of the bearish sentiment and give pundits some hope before the next leg down.  So in a perfect world, that's what we'd get -- but just keep in mind the market always reserves the right to form a fifth wave extension.

While sustained trade above Tuesday's high might be viewed as a caution signal for bears (as one option would be the larger complex black "or 4" on the chart above).

Either way, due to a question I received a few days ago, I really wanted to instead focus on a singular big picture chart today:

I originally annotated the potential targets for this bear market back in August of 2021, when I was still bullish and riding the trend higher -- but I annotated it in anticipation of the bear market we now find ourselves in.  I simply want to refer back to that annotation.  Sometimes the best targets are the targets you draw when you're not in the thick of things.

In conclusion, BKX covers the near-term, but (due to a question I received on the forum, which I assume is a question some others may have as well), I did want to again highlight that this is not a correction in a larger bull market.  Meaning:  It's not going to be over next month.  Or the month after that.  It's almost certainly going to take years to unfold, so (assuming I'm correct on the wave degree, and all early indicators suggest I am) it would help to adjust one's thinking in that direction.  Even my use of the term "early" above (as in: this is still the early phase of this bear) might be taken as a hint.  Trade safe.

SPX, NYA, COMPQ Updates

Yesterday, SPX captured its third downside target, and, as we'll see in a moment, tested potential support zones in a number of markets.  We'll also look at some possible target areas in the event support fails.

First, the legacy chart:

Next, COMPQ hit a horizontal and bounced:

NYA hit a horizonal and bounced, but is still below black:

The very long term chart, for reference:

And finally, bulls haven't done much yet -- if they can't muster more, then the chart below lists some additional downside zones:

In conclusion, SPX has captured its standing primary downside targets (for now), and some old support lines were tested, so it's always possible a larger bounce could develop here -- but so far, bulls haven't done anything but retest some broken support zones.  If they cannot recover those zones, the waterfall will continue.  Trade safe.

SPX, NYA, BKX, COMPQ: April 8 Target Captured

Today is a Fed Day, which means the market usually grinds around waiting for the announcement, then goes crazy for a minute, then seems to settle on one direction, which is often a fake-out, then heads the other way.  Not always, of course, because that would be too predictable.  But more than half the time.

It will be interesting to see if the Fed goes with the .50 increase they've been telegraphing for weeks, or if they go with .75, given that inflation is the highest it's been since the days when the Dodge Aries K was cutting edge new car technology.  If the Fed raises .75, investors will never trust their jawboning again.

Chart-wise, first up, my back-of-the-napkin target (read: I looked at the chart and this was where it looked like the market wanted to go -- very early in a pattern, targets are best derived by relying on experience instead of calculators, for me, anyway) of "mid-3700s" was captured:

COMPQ faces an interesting test:

BKX still in the same place:

NYA, unless it's working on a WXY or something ultra-complex, will look terrifying if that black trend line fails for more than a brief moment:

And finally, in a fast-moving market like this, big picture trend lines can become more important that micro counts:

In conclusion, there are some potential support zones nearby (50 month MA in COMPQ, trend lines in other markets), so we'll see if bulls can mount any sort of bounce here.  If they can't, particularly if NYA's lower line fails, we could enter waterfall territory.  Trade safe.

SPX Update

So last Monday's top call will prove correct with the new low we'll see on the open.  

How low can it go?  Well, BKX suggests there's room to run if it wants:

Long-term, I almost prefer to watch trend lines at the moment:

US Dollar will hit its next target:

In conclusion, I began this update with what seemed like plenty of time, then lost myself in the charts and ran out of time (!).  The short version bottom line is that we appear to be in a fifth wave, which means either we drop into the old target zones and find support, or we get a fifth wave extension and crash.  Since a crash is very possible in this position, bulls should await an impulsive rally before acting aggressively.  Trade safe.