FractalTrader
Short

SPY looking to reach 181, then fall

BATS:SPY   SPDR S&P 500 ETF
42 0 0
SPY             , QQQ             continued higher despite my original expectations going into Monday. Upon further analysis, what I originally (hastily) counted as a 5-Wave pattern off the low over the weekend, is actually an ABC in SPY             with a diagonal C-Wave. With a diagonal, the pattern can only be an ABC corrective wave. The convergence of the lines points to a likely termination around 181 for SPY             . Additionally, momentum has not yet made a lower-high peak, which I like to see before a turn. I have marked 179.19 as the reversal confirmation threshold.
The market is doing its dirty work, as bulls and bears alike are panicking. Only the patient are being rewarded here as this is a time when there are many opportunities to catch good setups.
I'm not certain of new lows in the majors at this point, so support areas should be respected, such as 177 level in SPY             hourly chart.
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