S&P500 (SPX) Hit Upper Targets. Two Sell Areas. Bitcoin/USD Daily Bars, LOG Scale, 06/14/18, 5:30 p.m. EST, by Mike Mansfield
Hi trader friends, quick post for a stock index move down that may happen from here or a bit higher. Even though we are into cryptos, I used to run a SP500 commodity program, then went all in on FX in 2003, so I like other markets besides cryptos. Here’s a post for futures & stock traders. There may be a short opportunity here or a bit higher around 2800-2810.
SUMMARY:
Spoos met a confluence of resistance lines yesterday than may stop the market. There is one other area just above this level that offer a clean short as well.
The black Schiff 0.50 Pitchfork line.
The blue upper parallel line.
The lower edge of the yellow Andrews Pitchfork.
Time for at least a quick reversal.
Two cycles heading down for approximately 10 & 17 more days.
Divergence on the Austin’s SSRSI indicator.
Braking today’s low of 2769 would likely set a moved down to 2745.
Put Call Ratio is at a low point that often means a significant down moves is near.
Mutual fund managers have near historic low levels of cash, meaning they're virtually all in.
But, there is still some fresh money left from foreign buyers, mom and pops and some hedge funds and of course the grand manipulators of all time, the world central banks.
One more push up? If we get a rally to 2800-2810 (2807 to be exact) where the Gann 8:1 line and upper blue parallel line meet, then get a 1-2 bar Key Reversal down on significant volume, that would be another good place for a short. This assumes that we are in a large degree Wave C rally.
Conversely, a daily close > 2807 likely means we are in a final 5th wave up of this years up move.
PATTERN:
I do not have time to do all the smaller wave counts, but with all the overlapping waves, it still looks like the market is in a complex longer-term corrective pattern that may not have finished with the February or April low.
ELLIOTT WAVES:
Unclear, but possibly a C wave high, that could be the Wave 2 high! Maybe we get one more push up to 2807 area. But if and when the market starts gapping down, then we
could have a wild Wave 3 to the downside on our hands.
RISK:
The GANN 8:1 line (upper dashed black line) is sometimes hit before a market has a major reversal. This was a call I had on Decred crypto a few weeks ago that was right on the money at the 8:1 Gann line. So, if this pullback doesn’t last a week or two from this point, then there might be another decent sell opportunity where the GANN 8:1 line meets
the upper blue parallel channel line around 2804-2820 area, depending if and when it gets there.
TARGETS FOR NOW, IF TODAY'S LOW IS BROKEN, BEFORE A NEW HIGH:
2743 (middle blue dashed line).
2686 (lower blue dash line and lower blue parallel channel support line.
NOTE: If lower blue parallel channel support line is broken, that could be quite bearish.
CYCLE TURNING POINTS:
Short-term yellow cycle bottoms 06/25/18 at NY open.
Longer-term blue cycle bottoms 07/03/18 at NY open.
NEGATION OF SHORT-TERM BEARISH OUTLOOK:
Closing above the GANN 8:1 line would likely mean we are actually an ugly 5th wave to a new all-time high.
Note the dashed green arrow heading upward at the lower black Schiff pitchfork. This could be the support level if the market is still excess bullish mode. If so, that is the place to try a buy.
Hum...
Where else can people put their funds with rates so low and likely to move up and crush bond holders? Real estate is in another bubble, but not liquid like stocks, so either stocks or cryptos. Watch gold the next few days.
See if we get some wild moves in ether bonds (time for Wave C of wave 2 bounce) to give a clue on stocks, of course bonds, gold, and cryptos. Watch the money flows.
DISCLOSURE:
This analysis is meant for educational purposes only. You trade at your own risk!
Cheers!
Michael Mansfield CIO
