Looking at the futures this morning it's looking like they are making another run up for a double top, which appears to be a hit of the rising brownish-orange trendline. If this rally extends out into Friday then it would be a higher high of course. But it's not looking good for the bulls right now as far as reaching that FP on the SPY from 2/27 this year. Possibly they top out today and drop on Friday several hundred DOW points (maybe 30-50 SPX points?) to wake up the bears and setup a final short squeeze back up into the middle of next week?
It's really a tricky spot here as they gave us the upside target with the FP but they haven't hit it yet and appear to be too weak to keep rallying up for several days to hit it. Believe me, I'd love for them to just rally up today and tomorrow to hit and then I'd take the short. But my gut (and the weak charts) tell me that the bulls are likely too weak here to get past this double top area on the first hit. I hope they do but I wouldn't be surprised if we don't see them rollover tomorrow after failing to get through that zone today. If you look at it from a wave count you could say the first move down from the 8/29 high into the 9/7 low could have been just an A wave of some degree inside a wave 4 down.
Then the rally up from that 9/7 low to a possible double top today would be the B wave up of that wave 4 down. Then tomorrow we could see the C wave down of 4 down to end the ABC 4th wave, which should wake up enough bears for a nice short squeeze into next week for the final 5th wave up into that FP from 2/27. Just a thought there guys as I'm not an expert on wave counts but do follow other experts and include their possible counts from time to time.
So, the question will be... do I short at today's close to catch that C wave down of wave 4 or not? We'll I can't answer that before the market opens in this morning update but I'll post it in the chatroom today at the close if I go short. I'll be looking for the market to close up near the highs for the day and for a double top to have happened. If this works out then the C wave down should go back into the falling channel area before ending is my best guess. So it could be a nice move that should make some good profit if timed right. Good luck as always.
P.S. If I'm wrong on the wave count (and the FP) and the high is put in today then I'll be very glad I shorted. 🙂