The S&P500 Melt-Up to 5500+ Is Still on Track.

S&P 500 Technical Analysis

A little over a week ago, see here, I found using the Elliott Wave Principle (EWP), the S&P500 (SPX) should

“ideally top around SPX4500+/10, then back down to SPX4430+/-10, and …. top out around SPX4700+/-50 for (red) intermediate-i before a multi-day/week correction kicks in: wave-ii. See Figure 1 below.”

The index topped at SPX4522, dropped to SPX4456, and is now trading at SPX4540, which is about 1.8% higher than when my last update was posted, thus supporting my Bullish thesis.

Besides, my short-term upside and downside targets were only off by ~0.3% showing the accuracy of the Fibonacci-based Elliott wave I used, and my premium major market members put it to good use. Indeed, I fit my opinion to the market and not the other way around because that is a futile exercise resulting in financial ruin.

Figure 1. S&P500 daily candlestick charts with detailed EWP count

Rally to SPX4700 should see a few minor pullbacks (4^th and 5^th waves)

So how are things progressing? Figure 1 above shows that (green) minor-3 is about complete because the index has reached the ideal target zone. It can still try for the 161.80% Fib-extension at SPX4600+/-10, but it is not necessary because there are enough smaller waves to consider wave-3 complete.

A short-term pullback to the wave-4 target zone at SPX4430-4490 should commence soon. Upper end preferred, from where wave-5 can rally to ideally SPX4640-4700. This Bullish thesis will come under pressure if the pullback moves below SPX4385 with a severe warning below SPX4430.

Bottom line

The S&P500 topped and bottomed, short-term, within 0.3% of my ideal upside and downside target zones, and should now be wrapping up a minor 3^rd wave. A multi-day 4^th wave down to ideally SPX4490-4430 should commence soon before the index can rally to SPX4640-4700. I still expect a 200-400 correction from those levels before the rally to 5500+ gets going in all earnest.

My Bullish thesis will come under pressure if the multi-day 4^th wave pullback moves below SPX4385 with a severe warning below SPX4430. Thus overall, the S&P500 is still progressing in a highly predictable impulsive manner, and I continue to expect this. Knowing the most likely path forward short- to long-term is tremendously advantageous because there will be very few real surprises.

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