Hello traders!
In previous posts about the sp500 (see links in description) we argued that some downside was coming and posted our short entry at 3994.
As you can see from the main chart, we connsidered the previous upside from October's low as a corrective move with choppy price action and low volumes.
We are considering different possibilities: either that move was a primary wave (B) to the upside, and main downtrend is resuming for lower lows, or it was only the first leg of this primary (B), and we are retracing down with an intermediate wave B about to conclude.
We are keeping our short with stop loss on entry.
We will refer to patterns and sentiment to assess probabilities of different scenarios.
The light orange zone of support that you can see in the chart, if broken, will activate a bearish head and shoulder that will lead to lower lows. However, since it is not broken, this pattern has not statistical validity.
Here you can see a bearish wolfe wave whose target will be consistent with both scenarios.
No hints for neither case from a pattern perspective until 3766 holds.
From a sentiment andfundamental perspective, we have seen soft lending narrative and the idea that slowing inflation may have led to a Fed pivot boosting bullish sentiment in tha last months. However, FED kept raising rates and banks are suffering it. The fact that all analysts and the general sentiment is not worry about it is a point in favour of a lower low;). But to consider it we want to see impulsive acceleration to the downside. Until then our targets will be 3840 and 3780.
Bests
GMR
In previous posts about the sp500 (see links in description) we argued that some downside was coming and posted our short entry at 3994.
As you can see from the main chart, we connsidered the previous upside from October's low as a corrective move with choppy price action and low volumes.
We are considering different possibilities: either that move was a primary wave (B) to the upside, and main downtrend is resuming for lower lows, or it was only the first leg of this primary (B), and we are retracing down with an intermediate wave B about to conclude.
We are keeping our short with stop loss on entry.
We will refer to patterns and sentiment to assess probabilities of different scenarios.
The light orange zone of support that you can see in the chart, if broken, will activate a bearish head and shoulder that will lead to lower lows. However, since it is not broken, this pattern has not statistical validity.
No hints for neither case from a pattern perspective until 3766 holds.
From a sentiment andfundamental perspective, we have seen soft lending narrative and the idea that slowing inflation may have led to a Fed pivot boosting bullish sentiment in tha last months. However, FED kept raising rates and banks are suffering it. The fact that all analysts and the general sentiment is not worry about it is a point in favour of a lower low;). But to consider it we want to see impulsive acceleration to the downside. Until then our targets will be 3840 and 3780.
Bests
GMR
Trade active:
Updated count and ascending broadening wedge (bearish)
Stop loss on entry
Stop loss on entry
Comment:
closed on entry
Comment:
breakout will confirm this count. Wave C targeting 4300+
