SPX - This is it or S&P500 is Still Alive, for a While at Least?

One thing is clear that volatility has considerably increased in SPX as investors are feeling nervous about sky-rocketing inflation, geopolitical risks, the slow down of the economy and even possibility of global recession which US is not immune to.

Following FOMC meeting 5 May 2022 markets have briefly reacted positively but the next day all gains have been lost. This might indicate that the current correction has not finished yet and investors are evaluating their risks and options before buying the deep.

Technical Analysis (Elliott Waves):

• Sharp fall in March 2020 has completed two year correction which has been formed in the shape of expanding triangle, a rare type of correction but usually followed by the rapid impulse
  
• Since then there was an explosive growth in the final impulse and it is likely that waves 1 to 3 have already been completed and wave 4 is currently forming
  
• Alternative scenario may suggest that the whole impulse have already completed and we are observing the global correction. However, fundamentally there was no trigger yet to collapse the markets - although US economy is struggling, it is not in recession just yet
  
• Using Fibonacci retracement it is likely that wave 4 will end at the level of 0.382, i.e. around $4010
  
• The completion of wave 4 will be followed by impulse or ending Diagonal in wave 5 to update the historic high
  

What do you think about SPX and its prospects?
Please share your thoughts in the comments and like this idea if you would like to see more stocks analysed using Elliott Waves.

Thanks

Comment:

Update to the scenario