I almost got a call this morning from TD Ameritrade when the market gapped down and put in a low of 1640 but it was not within my trigger range (below 1637), so the market continued its bearish advance from yesterday as I had been expecting. However, the 3rd wave down was not as strong so we'll see if the 5th wave will make up for it. The market bounced from the day's low in what appears to be a W4 and it came within a point of invalidating the 5 wave count, so any more upside beyond the counter rally's top would signal a bullish wave coming. For now, I am assuming we will see a bearish wave to finish up the 5 wave count and challenge the 1625-1635 area. Adding to the bearish view, the Trend Average has turned negative with today's close and that has not happened in almost 2 months. Also, there is an arguable Head and Shoulders formation targeting 1602. It's a perfect looking H&S but since it was not formed at a top but a middle of a downtrend, I am not sure what are the probabilities of it materializing,
I was tempted to position trade VXX when the market hit 1640 but abstained. So I am looking for a good level to lock in profit.. maybe tomorrow I will get the call!
Main S&P 500 Trends
Short Term Trend = Bearish
Medium Term Trend = Bullish
Long Term Trend = Bullish
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