As 2018 nears a close the SPX has a mixture of bullish and bearish signals.
The SPX chart shows additional bullish evidence from a Fibonacci support area.
One Elliott wave alternate count has the January 2018 top as the termination point for Primary wave "3" of the bull market from the March 2009 bottom.
The pattern after the January 2018 peak could be a combination wave correction, these are similar to Expanding Flats, except the decline from the all- time high does not subdivide
into five waves. When a corrective pattern moves beyond the termination point of the prior impulse wave,Fibonacci retracements can begin from either the orthodox peak in this case SPX 2872 or the actual peak of 2940. The SPX bottomed six points below a Fib .236 retrace of the move from SPX 666 to 2872. To view a smaller version of a combination wave correction please examine the SPX from April to June 2016. If the SPX recent bottom at 2346 holds I will have a future post detailing the SPX 2018 combination wave.
On the bearish side of the coin this is what's happened since the SPX bottom at 2346.
1) Intraday pattern appears corrective - probably a double Zig Zag
2) The SPX high of 2520 on 12/28/18 had intraday bearish divergences for the RSI and MACD.
3) SPX 2532 was previously significant support. SPX 2520 is only 12 points below what could now be significant resistance zone.
Watch SPX 2397.94 a break below this level could open the door for at least a retest of the recent low at SPX 2346.
If SPX support at 2346 is broken the most likely target could be SPX 2280 which was discussed in one of my prior posts.
If instead the SPX rallies - a 15 point move above 2532 could indicate a bullish break out.
Mark
The SPX chart shows additional bullish evidence from a Fibonacci support area.
One Elliott wave alternate count has the January 2018 top as the termination point for Primary wave "3" of the bull market from the March 2009 bottom.
The pattern after the January 2018 peak could be a combination wave correction, these are similar to Expanding Flats, except the decline from the all- time high does not subdivide
into five waves. When a corrective pattern moves beyond the termination point of the prior impulse wave,Fibonacci retracements can begin from either the orthodox peak in this case SPX 2872 or the actual peak of 2940. The SPX bottomed six points below a Fib .236 retrace of the move from SPX 666 to 2872. To view a smaller version of a combination wave correction please examine the SPX from April to June 2016. If the SPX recent bottom at 2346 holds I will have a future post detailing the SPX 2018 combination wave.
On the bearish side of the coin this is what's happened since the SPX bottom at 2346.
1) Intraday pattern appears corrective - probably a double Zig Zag
2) The SPX high of 2520 on 12/28/18 had intraday bearish divergences for the RSI and MACD.
3) SPX 2532 was previously significant support. SPX 2520 is only 12 points below what could now be significant resistance zone.
Watch SPX 2397.94 a break below this level could open the door for at least a retest of the recent low at SPX 2346.
If SPX support at 2346 is broken the most likely target could be SPX 2280 which was discussed in one of my prior posts.
If instead the SPX rallies - a 15 point move above 2532 could indicate a bullish break out.
Mark