Here's the case for a crash.
You may have noted I can, on occasion, be a bit of a bearish guy - but I don't actually use the word "Crash" all that much. Not all bear setups are crash setups. Even when they will be, a less dramatic bear move usually happens before a crash. The times when there's actual crash risk are low - but we have a confluence of them now.
Let's run through some crash signals.
1 - Pending 1.61 break. In any self respecting crash (anyone you know by a number for sure) the crash clearly picks up on a 1.61 break. If we drop again, we threatening that break.
tradingview.coem/x/Q9XSCqfy/
Examples:
All the good ones, and other ones. Go look. You'll find over and over a downtrend transitions to a crash under the 1.61. The 1.61 either does not break- or we crash.
We currently have a bounce off the 1.27, retest of the previous structure and possible new sell off coming - these are things that can precede a 1.61 break.
Looking at local structure, this looks like a butterfly correction. Which is often found at or before the MIDDLE of a trend (crash).
Or an ABC.
Which would predict a drop stronger and bigger than the first (crash).
Then you have things like the 200 SMA bounce, those can get sketchy if there's a new low.
...Crash.
And we have the reason. Because although the technical norms I've explained here have been features in every notable crash ever, there was always a reason. Always something that would not be foreseeable with TA and would make the crash appear to be unpredictable.
The things that just seem too weird to be true unless take time to look into them.
Like Covid being a perfect 1.61 top.
Which started similarly to what we have here.
The Covid crash would start once the 1.27 broke- which is where we are now.
Conditions for a crash now are actually realistic. Generally speaking a crash is something that it's only valid to speak of potentially in the future in the event of multiple markers hitting. Lots of things have to happen before we have real honest and true crash conditions.
Unusual things. Like trending down consistently for a couple months.
Having insanely aggressive bounces off support but not really getting anywhere.
Containing a correction inside a 2 leg structure.
...Breaking a 1.61.
See where I'm going with this?
It might happen. If the low is not made, we enter into real crash territory on the next break.
You may have noted I can, on occasion, be a bit of a bearish guy - but I don't actually use the word "Crash" all that much. Not all bear setups are crash setups. Even when they will be, a less dramatic bear move usually happens before a crash. The times when there's actual crash risk are low - but we have a confluence of them now.
Let's run through some crash signals.
1 - Pending 1.61 break. In any self respecting crash (anyone you know by a number for sure) the crash clearly picks up on a 1.61 break. If we drop again, we threatening that break.
tradingview.coem/x/Q9XSCqfy/
Examples:
All the good ones, and other ones. Go look. You'll find over and over a downtrend transitions to a crash under the 1.61. The 1.61 either does not break- or we crash.
We currently have a bounce off the 1.27, retest of the previous structure and possible new sell off coming - these are things that can precede a 1.61 break.
Looking at local structure, this looks like a butterfly correction. Which is often found at or before the MIDDLE of a trend (crash).
Or an ABC.
Which would predict a drop stronger and bigger than the first (crash).
Then you have things like the 200 SMA bounce, those can get sketchy if there's a new low.
...Crash.
And we have the reason. Because although the technical norms I've explained here have been features in every notable crash ever, there was always a reason. Always something that would not be foreseeable with TA and would make the crash appear to be unpredictable.
The things that just seem too weird to be true unless take time to look into them.
Like Covid being a perfect 1.61 top.
Which started similarly to what we have here.
The Covid crash would start once the 1.27 broke- which is where we are now.
Conditions for a crash now are actually realistic. Generally speaking a crash is something that it's only valid to speak of potentially in the future in the event of multiple markers hitting. Lots of things have to happen before we have real honest and true crash conditions.
Unusual things. Like trending down consistently for a couple months.
Having insanely aggressive bounces off support but not really getting anywhere.
Containing a correction inside a 2 leg structure.
...Breaking a 1.61.
See where I'm going with this?
It might happen. If the low is not made, we enter into real crash territory on the next break.
Trade active
I'd say we're at a viable point to start to think about taking super speculative bets on this over the coming days if we see a rejection 5400. Note
Conservative target would be 4500. More likely crash target would be 4000.
Note
Some people really think 4000 could not hit. Inside the norms of trend development you could make a case for it inside of a bullish move. Simple ABC correction.
Which would imply a crash leg - inside of a bullish pattern.
Note
A more bearish outlook would be something like this. 
We may be inside of a crash event to 3000 in SPX.
Read the full case with backlog of historic analysis/forecasts here: holeyprofitnewsletter.substack.com/p/the-case-for-3000-in-spx
Read the full case with backlog of historic analysis/forecasts here: holeyprofitnewsletter.substack.com/p/the-case-for-3000-in-spx
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
We may be inside of a crash event to 3000 in SPX.
Read the full case with backlog of historic analysis/forecasts here: holeyprofitnewsletter.substack.com/p/the-case-for-3000-in-spx
Read the full case with backlog of historic analysis/forecasts here: holeyprofitnewsletter.substack.com/p/the-case-for-3000-in-spx
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.