S&P 500: Potential Nine Percent Decline Setup

OANDA:SPX500USD   S&P 500 Index
S&P 500 decline in a five-wave contracting pattern knows as leading diagonal from its all-time high. It's labelled i-ii-iii-iv-v in wave (a).

According to Elliot Wave theory, a three-wave correction follows every impulse move, that's the subsequent a-b-c zigzag move in SPX . The correction retraced more than 80% of the impulse, retested the upper boundary of the channel + daily demand zone .

Price is expected to resumed in the direction of the major impulse after a correction. The decline in wave (c) has the potential to take wave (a) low and beyond.

I will look for the break out of the parallel channel and green line for a conservative short entry while the red line is my short-term invalidation zone.
What's your view on S&P 500? Let me know in the comment.


Personally I think the ABC started with the drop in early Sept and ended w/ the low on Sept 25th. Currently I think we still owe wave 5 (and maybe some more of 4) of a 12345 up.
+1 Reply
vanfleetdaniel isabellaalexandra
@isabellaalexandra, Exactly my thought. The larger 5 wave is not over yet but wave 4 might go deeper than most folks expect.
Veejahbee isabellaalexandra
@isabellaalexandra, Thanks for your contribution. While the price is trading above wave "b" in blue low on the chart, the bulls still have a chance. Once that low is breached, then the bears have really taken control.
High probability it will continue upwards within your defined channel all the way through 2020. Afterwards anything might happen, but the corrective C wave will not happen soon
Veejahbee poister198
@poister198, Anything is possible. Let's see how it plays out!
I m with you on this one
Veejahbee fortunawatches
@fortunawatches, Thanks for your comment!
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