S&P 500 Breakdown Retest — Bears in Control, Bigger Drop Ahead?

Feb 4

Today, I want to share a short setup on the S&P 500(SPX). Given that the crypto market—especially Bitcoin(BTCUSDT)—has recently regained strong correlation with the S&P, this analysis may be important for the crypto community too.

The S&P 500, over the past 20 days, has shown upward moves with low volume, while downward moves have had stronger momentum and volume. This indicates bears (sellers) have more control. The reasons include Federal Reserve policy shifts and escalating Middle East tensions. Historically, such tensions have led to S&P declines.

From a technical perspective, on the 4-hour timeframe, the S&P 500 has broken its support zone($6,956-$6,925) and is pulling back to it.

From an Elliott Wave perspective, it seems the S&P 500 is completing its main wave 4, which likely has a Double Three Correction(WXY) structure.

I expect the S&P 500 to decline toward the support lines. If broken, we could see the index drop further to at least $6,853.

Note: If Middle East tensions escalate further, as news suggests, the index could drop suddenly. Conversely, any agreement (e.g., between Iran and the U.S.) could support a recovery. Stay tuned to the news flow.

Note: A decline in the S&P 500 to at least 6,850 could also lead to the loss of Bitcoin’s heavy support zone($78,260-$70,080).

First Target: Support lines

Second Target: $6,853

Stop Loss(SL): $6,979(Worst)

Points may shift as the market evolves

Can gold resume its bullish trend, or should we expect deeper corrections?

💡 Please respect each other's opinions and express agreement or disagreement politely.

📌 S&P 500 Index Analyze (SPX500USD), 4-hour time frame.

🛑 Always set a Stop Loss(SL) for every position you open.

✅ This is just my idea; I’d love to see your thoughts too!

🔥 If you find it helpful, please BOOST this post and share it with your friends.

Feb 5

Trade active

Trade was activated in Pullback

Feb 5

Trade closed: target reached

Full Target Done