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First published on Saturday May 6 for members of ElliottWaveTrader.net: Last week, I noted that we still likely have lower levels to strike in this complex, but that I expect the market to set up a bottom very soon. I still maintain that expectation as I write this.
In my last weekend update, I noted that we still needed to complete waves 3, 4 and 5 in this (c) wave of wave (2) in the GDX. We now have the minimal number of waves in place to the downside to consider it complete. However, we did not strike our ideal target of 20.31, where (a) would equal (c), nor did we see a full 5 waves up off the lows we struck this past week. So, since we do not have any confirmation that a bottom has, in fact, been struck, it leaves the door open for the market to still strike our target.
Looking for an AM low this morning before ideally a push up to retest the Sunday night globex high on ES, target area on SPX for that would be 2407/8 area. I’ve been looking at the important short term support levels on SPX and they are the 5dma currently at 2393.5, short term rising channel support currently in the 2392.5 area, and the 50 hour MA currently in the 2389.50 area. My lean is that none of these levels are likely to be broken before the Sunday night high is retested. If the short term rising channel breaks then my working assumption would be that SPX has moved into a topping process for a swing high that should last a few months. SPX 60min chart:
A quick glance at ZeroHedge this morning tells me that being in the bad news business is awfully tough these days: with Emmanuel “Clinton” Macron winning France, equity markets at lifetime highs, and no meaningful geopolitical turmoil, there aren’t many coals to stoke. Indeed, they’ve resorted to running stories about what a dangerous city Baltimore is, which is like me writing a header post about why ill-fitting shoes are uncomfortable.
I have had a happy distraction in the form of SlopeCharts, and judging from how much Slopers are using them, I’d say it’s off to a great start. I keep emphasizing “this is just the beginning”, and if you saw the list of features I plan to add, you’d know it’s true. It has been over a dozen years since I’ve had a chart platform to control, improve, and expand, and it’s an extremely liberating feeling for someone like me. By the time I’m done, the other chart platforms on the web will be embarrassing (more…)