Todays drop could be a 1st wave of another full wave down. We are now reaching that 4th time is better than the 3rd time trying to break the support. I feel that the next time we test the lows again, we will break it convincingly. Its not to say that the 1800 is not attainable but its looking less likely as the days goes on. The next level to look at should be the 1750, 1740, 1710, and 1700. If we are counting this as an ABC pattern for a correction from the highs, we can use the A=C probablility and it gives us a target of 1720 with possible throw under if the momentum has legs, but the 1720 is the Sept 2013 top range. If we are counting the next leg lower as a 5th wave then the subwave 3 of that targets the 1750 price as the 161.8% of the 1st wave. These are all probabilities, but there is no question we are in a downtrend.
Now for the technicals. The SPX is sporting a small right shoulder of some sort if you want to use it as a measure. Our ST is back to a down position and still in Oversold as I indicated yesterday. Therefore Price Acceleration risk is still to the downside. There is also talk that the next logical and psychological target for techs out there is 1700 because of the 200 daily ma which sits in that area. The Weekly lower BB line is also approaching the 1700 We have not seen a positive divergence in the cash market but there is one forming in the futures (ES), and a possible wedging lower vs. the SPX cash. All these puts us at a main trend that is still strongly to the downside. The MT is used as the longer term trend, but can be off if volatility comes into play. Therefore the ST should be used if you want to make the best of the low and high prices.
MT: DOWN
ST: DOWN
PA: DOWN
60 Min.
Daily
Weekly
BONUS: GANN PRICE by DEG. Clustering under the slope
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