There's evidence to assume that the S&P500 has completed 5 impulse waves up from the '08 financial crisis lows. Regardless if this is true or not, what I'm seeing is that we are currently in an ABC correction, meaning the drop we saw starting in early February 2018, is just part 1(A) of 3(A-B-C).
We put in a wave B on Friday, 3/9/2018, and are currently in wave 2of5 of wave C that will take us to test the 245-250 range on SPY. Will get more accurate targets once wave 2of5 completes and wave 3of5 is confirmed.
-AL168 March 20, 2018
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It is unfolding as planned. Wave 2 hit the 38.2 retrace and reversed. FYI - the pink waves are for illustration purposes only, not a predictor of timeframe. I'm thinking it will follow the C line more closely.
We should get a few green candles after it drops a bit more, maybe after touching 255.5 next week. Then time for one more leg down.
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The bearish story still sticks until we can pass 269-270+
Wave iv is complicated and volatile, which aligns with alternation theory of the short and simple wave ii.
What we are looking for is a breakdown to the 247-250 area, occurring around 4/12-4/14 next week. Ho-hum jobs report today, trade war, fed talks, etc signal interesting times ahead. We shall see.
If we do hit these targets on the bottom, I am bullish on SPY for the remainder of the year. Will post a separate analysis after this one completes.
Trade closed: target reached
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254.67 should be the bottom of this story.
Today the uptrend finally passed the level of the first wave down of wave C, confirming bullishness, and a new chapter.