Is The Bottom In?
I think it is...
The time line has extended but the overall plan hasn't. The market is still likely to have one more new high, but not likely this week. It should happen next week, like around the end of the month or the first day or so of July. We are not likely in the big drop right now, even though the last few days have been quite bearish. There's one more move up still highly likely to play out, and it should take out the current all time highs to hit the stops on the shorts. I posted the chart below on X yesterday and it's still valid.
Considering how big of an event the coming 4th of July is for America I don't think we will be tanking hard into it. After the new high next week, which could come on June 30th, July 1st or even July 2nd, the market should start the big correction everyone has been waiting on, but the bulk of the big drop won't likely happen until after the July 4th holiday.
Meaning the week of July 6th should be an ugly one I think, and this drop can last into mid-late July before the 6800-6900 bottom is reached. Since the week of the 13th is OPEX for July I suspect that will be the bounce area for some wave 4 up in a C wave down, and then the following week of the 20th is where the wave 5 down of C finishes the entire ABC correction. It's hard to nail down the exact date or price but that's a rough idea.
And I do think the 692 FP on the SPY will be hit and pierced, so we have that as our target... but it could just be the bottom of the wave 3 of C, and the wave 5 of C could be a retest that goes a little lower? Or it's the bottom of 5 of C and we stop in the 7000's somewhere for the 3 of C to do the bounce for 4 of C. My point here is that if you are planning on holding short until the FP is hit you might not see it until the week after OPEX and there could be a nasty bounce during OPEX to shake you out.
For the short term though, I think we bottomed yesterday and will start the last move up today, which will carry into next week. Again, we should easily take out 7700 ES and possibly reach 7800? I don't know the price high but if they want to make the market look great for the 4th of July it would need to get up high enough that everyone will start calling for 8000 and give up the bear case. I think 7800 would do it, as bears would throw in the towel at that point and go long at the top. We should NOT see 8000 until after the correction to the 6800-6900 area, whereas that's the starting point for the big squeeze into mid-September where 8200 is possible.
Have a great weekend.
