In yesterdays update I suggested that we ended a large A wave down and started a larger B wave up, that I would consider shorting at the close, but that that I would change my mind if the rally up was to strong or if we dropped to a lower low and close red. Needless to say I did not take a short. In fact I was thinking about a long as I expect the larger B wave is still yet to come. What yesterday looked more like was a small wave 4 up at the open and a small wave 5 down into the close.

This meant that the small wave 1 down and 2 up happened during Mondays chop and then the small wave 3 down occurred on Tuesday where the largest part of this move happened. All 5 of these waves I'm calling a large A down. I keep it simple with Elliottwave as I'm not an expert and don't really believe in it too much for forecasting the future. But short term wave patterns "sometimes" can be forecast-ed when you add in technical analysis, news events (like the G20 this Friday/Saturday), seasonal factors, support and resistance, put to call ratio, volume, and other things too. So while that early pop higher yesterday could have started the larger B wave up it fade way too quickly and just drifted down the rest of the day into the close.

If it were a true larger B wave up starting I just felt that the gap up would pullback small and then turn back up to go even higher the rest of the day. Instead it acted like a small wave 4 up inside large A down, as it got exhausted quickly and then the small wave 5 down took over the rest of the day. But that 5th wave didn't have much momentum to the downside so it just barely made a lower low. Bottom line here is that I don't think the larger B up has started yet. And I suspect it will start today. The ES Futures were up about 20 points after-hours from the 2914 low at the close yesterday. They rolled over about 5:30 am and dropped to "almost" hit a double bottom from that low, but make a higher one and are back up in the green again right now.

I suspect that we'll start that larger B up today and that it will divide into 3 smaller waves, of which the small A up and B down should happened today, then the small C up all day on Friday. It makes sense from a "fear" stand point to as we are still one day away from the G20 and traders don't know the outcome, so a few bulls nimble at longs today and then sell later, which makes the small A up and small B down. Something positive, or "not" negative is released sometime tomorrow and the bulls buy for the small C up. Sometimes it's not what is said, but more that the event is over with that's important.

Traders just don't like the UN-certainty that these meeting can bring, but once past they get back to trading what they see. My guess is that nothing new comes out of the meeting but it's enough to get that smaller C up to happen all day Friday. Then over the weekend the news becomes realized as negative for the market and we start a large C wave down on Monday. Anyway, for today I'm slightly bullish as I think the low was put in yesterday but I don't see a breakout to the upside until tomorrow. I think chop is more likely today to make that small A up and small B down. Good Luck and my God Bless you today and everyday.

We finally got around move down yesterday and since it closed near the lows I decided to close out my short and go to cash to see if there was a bounce today. So far, so good as the futures are indeed up some here before the open. If we are going down in an ABC pattern then the low yesterday completed the A down and the rally today starts the B up. With the G20 meeting this Friday and Saturday I'm really not sure how long this B up will last?

Remember that the usual pattern is to sell in front of events and meetings that make investors nervous as some change out of the meeting could effect the market. That's the case with this meeting, so I'd be surprised if this B up last into Thursday, and certainly not Friday. Anything is possible but I think it ends today by the close and the C down starts afterwards. Just speculation of course, as EW counting is best done afterwards (and useless for trading) and always a "best guess" when looking forward into the future. But that's the wave count that makes sense with all the other known factors included.

The market is very overbought short term on the daily and needed a pullback like this. Plus we are at double top areas on most all of the indexes (not the Russell), and there the fear factor in front of the G20, then there's the low put to call ratio, where everyone became too bullish and bought way more calls on the SPY then puts. So there's many reasons to support the Elliottwave count of a ABC pattern move down in play. If it plays out and we are near the expected end of the C down, then is where it will get tricky.

From there we won't know of the next move up will take us to new all time highs or just another lower high. But I suspect the outcome of the G20 will give us some great clues to the strength of the rally that follows. That's next week though, and we haven't even made it past this week... so back to the present. My thoughts are that today will end the B wave up and that's we are likely in a ABC move down. So I'll look to take another short probably at the close today. What would change my mind is too strong of a rally up, or another drop to a lower low today and a red close.

I want to see it close green and not too much further north then 10-15 points (SPX/ES). I also don't want to see too much weakness today as that would negate the B up as then it could just be a wave 4 up of that A down and the weakness (drop back toward the low) could be the wave 5 down to end the A wave today, and not yesterday like I currently think happened. So if we drop too much I will start suspecting that the A down didn't finish yesterday, which then further suggests the B up hasn't yet started. That's what I'll be focused on. Good luck and Happy Hump Day.

While the SPX and DOW went mostly sideways all day yesterday the Russell was quite weak and dropped nicely. Is it foretelling us what's to come? It certainly could be as inter-index divergences do happen at tops and bottoms. The Russell never even got close to it's prior all time high in this last big rally up from the early June low, so that's something to pay attention to as if the overall market was about to start a new bull run to 3000+ on the SPX and 27,000+ on the DOW then the Russell would be right there in-sync with the others to.

But that's not the case so odds favor the bears here in the coming days to take the market back down some to shake out the bulls and lure in some bears for another rally attempt later next month or so. There could be several attempts at breaking 3000+ on the SPX in the coming months if the pullback is weak. But a deep enough pullback should get enough bears short to squeeze to 3000 and beyond by the end of the year, as well as make a new all time high on the DOW, which hasn't happened yet... another reason to "not believe this rally", and to be cautious as a pullback is much more likely.

As for today it's starting off flat and might stay that way all day just like yesterday, which I'm sure is due to the market waiting on the G20 meeting to see the outcome about tariff's, which is this Friday and Saturday. Personally I don't think traders will keep going sideways that long as I expect a move one way or the other prior to the meeting, and I think it will be down. When fear of the unknown is in a traders mind the logical thing to do is to sell, which is exactly what I think will happen before the meeting. Will it start today, tomorrow or Thursday... I don't know? But I took a small short position yesterday and will look for another one today and/or tomorrow if more sideways action happens. We'll see, but for now I'm bearish going into the end of this week. Today though I'm neutral. However, on IWM I'm bullish... just for today though. Have a great Tuesday.

Futures are up a little this morning but not much, especially when compared to all the big gap up opens and runs from last week. The G20 is this week so we could have some volatility, and considering how high the market is at right now I have to think we'll see some downside action. The bears really need to attack hard as this is the last week of the month and commonly the weakest, so they have some edge on the bulls right now.

If I were them I'd start with a down move today, nothing big, but something to get the wave counts in their favor. They need a series of wave 1's down and 2's up to line up a nice layered wave 3 down of some degree. I'm not an Elliottwave expert as I don't think it has much use in forecasting the future. It's better for looking at the past, but when combined with other indicators and methods one can use it to see what is coming soon, but you just don't know the "when" part with EW as wave counts can extend and subdivide and have alternate counts, blah, blah, blah.

So when I talk about wave counts I'm just projecting out into the future what needs (not always, but most of the time) to happen to setup a big sell signal. It's not that the market obeys EW rules but it's that waves up and down are used to shake out traders on both sides. Sometimes it's easy to shake them out and maybe only one series of up's and down's are needed. Other times SkyNet might do a series 3 or 4 times to shake them out... which in EW terms it would be called "subdividing" waves.

I don't even try to predict how many but just look at the levels the market is at along with the technicals, to see if it's ready to take a dive or not. Right now the SPX has made a new all time high, but the DOW hasn't, nor has the Russell and the Nasdaq. So if the bears want to take this market south this week they need to keep these indexes from breaking out like the SPX, and especially the DOW as it really leads the market.

They also need to start shaking out some bulls and tricking some early bears... aka, the up and down series needs to start. Just get a wave 1 down today bears and try to close it slightly red, then up tomorrow and do another series intraday, followed by a final green close on Wednesday for a lower high and then we could just see a big drop follow. As for today, I don't see any clear direction. Just have to wait until it unfolds unfortunately. Welcome to another new week.

P.S. Overall I think this week will be a down one, just not sure when it will start? Dropping 50-100 SPX points is what I'd expect to see by this Friday.

Everyone keep in mind that the SPY went ex-dividend today so it's lower by that amount (usually a little over a point) to adjust for that, so it's not a mistake. Ok, for the futures this morning we see them down about 10 points so nothing big and is really normal after such a huge 2 day short squeeze. I don't see anything setting up on the bullish or bearish front for the close today. I expect it to be a slow day with limited downside and limited upside. Since it's Quad Witching for this expiration there could be some a little more swings up and down then most expiration's but again, I don't think it will be huge... nothing like yesterday. Next week though I do think we'll see nice trade setup, and odds favor a short, not a long (but a long is possible for late in the week). Today though should be a boring one, so I'll keep this update short and end it here. Have a great weekend.

Bulls are on a stampede again this morning and are within striking distance of the all time highs on some indexes but have already made a new one on the ES Futures. I was only looking for the gap to get filled at 2945 so the extra 20 points higher is a surprise. And big sell that was setting up for early next week has now been put on ice as with a new all time high being made the sky is the limit on the upside, and at best the bulls will rest and go sideways for week or so to consolidate before making another move up. Very disappointing news for the bears it seems. I'm quite disappointed myself as I was really looking forward to a big short. We might still get one, but odds don't favor next week... maybe several weeks out at this point, hard too say.

However, when a double top is made odds to favor at least some kind of pullback that results in either forming a top with some sideways chop for awhile or that sideways action forms a bull flag and the bulls take another leg up afterwards. How to play it is the question? Since you're not expect much of a pullback, if any, I personally will be looking into selling credit spreads.

It's just me nibbling in the market as I've been unable to get a bearish setup to form or a bullish one. This ramp up that started yesterday was something I thought was going to start last week on Friday, but I got burnt that day as nothing happened but more sideways crap. Believe me, if I could have seen this bullish move before it happened I would have taken a long.

But it is what it is, so I'll just look to play with the cards dealt me, and right now that's trying to predict a "pause" moment, which I think will happen tomorrow and maybe Monday too as this move up is almost 80 points from the thrust starting point 2 days ago and we are at double tops. That should provide some strong resistance and stop for the bulls for several days on the first hit. Next week is when we'll see if the bulls have the ability to blast through it and run up another 80-100 points... or if they fail to hold it and we drop back for a week or two.

Anyway, my plan for today is to watch closely to see if the bulls struggle to push up higher and if so I'll look at selling a credit spread with the thoughts in mind that we'll chop sideways to down for the next couple of days, where I can then keep the full credit or close the position for a gain of some of the credit. Have a great day.

Yesterdays strong rally up was just the bears needed to shake out the weak shorts and convert them into bulls. By the end of this week I fully expect the euphoria to wear off and exhaust the bulls, which then means the smart bears will attack and drop this pig when no one is expecting it. The closer we get to the all time high the better as any move down will be bought by the bulls and that just means it will keep going lower. How low is anyone's guess but if the double top rolls over like I think it will then 2800 SPX is a no brainier... probably a lot deeper.

I don't want to call out levels yet as this big sell setup hasn't happened yet. But one of the things needed was that squeeze rally yesterday, and today we just need mostly sideways with a little more up preferred for another green close. Tomorrow and Friday is where I'm hoping we'll see some teasing by SkyNet to lure in more bulls thinking we are going to bust out to a new all high and shoot for 3000+, which is what's needed to drop the market back down again next week. Basically we need to see some kind of wave 1 down and wave 2 up, or several sets of them over the next few days.

If we blast up to a new all time high and hold it into the close then this short setup will be delayed. For it to happen we just needed the strong squeeze up yesterday and then several days of consolidation where not much more gains are made, and green close preferably. What we don't want to see is a reversal back down that resets the short term overbought charts and appears to be a wave 4 of some kind, whereas a wave 5 up would follow. It's more about holding the line here and not letting trapped bears out.

We could still do a 4 down and 5 up but they need to be small, and then the 1's down and 2's up can follow. I'm guessing this sell will setup by this Friday or next Monday, but it can be delayed of course. These tiny wave patterns and mostly sideways action for several more days are needed for the last bear to capitulate and then and only then can a big sell occur. Moves down that close red are the bulls way of resetting the overbought charts.

Maybe we could get away with one red close over the next several days, but the last day must be green. It's like today could be slightly red for maybe that tiny 4 down and then tomorrow up for the 5th wave. Then some 1's down and 2's up for a few more days that close green each time. That should do it. I'll keep you up to date of course. Have a nice day.

All eyes are on the the FOMC meeting this Wednesday it seems. The market has just been trading side ways every day with little clues to the next big move. But if you look at past FOMC meetings you'll find that most of the time they were viewed positive by the market and closed that day in the green. As far as "turns" in the market that didn't usually happen for 1-2 days later. There are certainly a few previous Fed days where the market turned down starting that very day, but I'd guess it's less then 20% of the time.

For this current time period I see the past 5 trading days as mostly sideways, which could be viewed as a bull flag or pennant pattern. The MACD's on the daily chart are certainly pointing up and the 4 hour charts has yet to put in any negative divergence yet, so a rally should make that form. The weekly chart though is another story as it looks bearish to me. The spinning top candle pattern last week after a prior week put in a strong bullish engulfing green candle is worrisome.

The Stochastic are still bullish as they did put in a positive cross and are only about midway up from being oversold, but on the daily they are overbought. It "suggests" to me that the upside is limited this week due to an overbought chart on the daily but the downside is limited as well due to the weekly chart still looking more positive then negative. My thinking is that we might get a short lived squeeze going early this week (maybe on Fed day?) and then a pullback later in the week.

I'm not looking for the low from a couple of weeks back to be taken out though, but a retracement of half or more of the move up is possible this week. Then we'll look again at the weekly and daily charts to see if it looks like the Stochastic's are going to keep going up or rollover. The MACD's already have the bearish cross on them (weekly chart) and are trying to cross back, but I have my doubts on that happening anytime soon. Charts looks mixed to me with odds still favoring the bears.

Short term looks like a choppy range-bound market for this week and possibly next week too. I expect the SPX to trade in a 100 points range up and down for several weeks to let the weekly chart either firm up and get bullish looking, or to fail and rollover... and I think failure is the more likely outcome. For today... we'll, I'll try to stay awake but I'm not expecting much action. It's all about the Fed meeting this Wednesday and until then I don't think we'll see any sharp moves up or down. Happy Monday to you.

Yesterday into the close there was a large spike of volume and the SPY jumped up almost a dollar in that last 5 minutes. I took a small long on it as I am speculating that was someone "in the know" that expects the market to go up soon. I thought maybe we'd open up this morning with a gap up but that's not the case as the futures are down a few points here in the premarket session.

That could still change of course and we could still start a rally up today but right now the market is continuing to chop sideways with no clear direction. The FOMC meeting is next Wednesday and it's pretty clear the market is in a holding pattern waiting to see what is said. But this sideways pattern won't likely continue for too much longer. I'm still thinking we'll break one direction or the other and I still think odds favor the bulls.

There's still too much bearishness out there to support another large drop I think. We should go up first and then down later. But the market is tricky and never makes it easy, so you have to be open-minded for the opposite to happen too... which would be a surprise drop first. Yesterdays intraday low is very important for the bulls and they really need to stay above it today.

If it gets hit I think we could see a flush out down as stops will likely be hit to take it down fast. I don't think that will be the case as today is looking again more like a choppy sideways day, or a bullish one. There's not much more to add as until this coming FOMC meeting has passed trying to read the charts is worthless. Have a great weekend.

Yesterday was certainly a boring day as the market just chopped sideways all day long. Last night afterhours though there was a fast drop in the futures around 10pm EST of about 10 points or so, but now this morning it's completely reversed and is up about 10 points or so. Kinda makes me think the market found a bottom and is now trying to start that "possible" wave 5 up.

It's still not what I'd call a strong move but it is a move up at least. There's really no set amount or percentage for a wave 5 as they can extend and subdivide or just be one short wave. Many will even truncate short of the 3rd wave high, so the bulls really need to put the pedal to the floor here or else the bears are going to take control again very soon.

The weekly chart looks very bearish to me last weeks' strong up move that made a long solid green candle that engulfed almost all of the prior 3 weeks needs follow through or else it will all have been for nothing. This weeks candle is currently looking like a doji candle with a small move down and small move up in the body, which are sometimes called "spinning tops" as well. Tomorrow is the last day for this candle and I suggest the bulls close it green, as it's currently red. That's not hard as it's just a few points higher.

They just need to close over 2893.25 tomorrow, but still, it's not a bullish sign. In fact it suggests a down move is coming next week if history repeats, and it at least rhymes an awful lot of the times. This week is looking similar to the week of 2/19/2019, whereas the prior week dropped about 80% of prior weeks' big green candle up rally. Meaning if the pattern follows here we should go down to the 2770-2790 zone to make a higher low then the 2728.75 low the week of 6/3/19.

Again, patterns never repeat exactly but when I look at the weekly chart I just don't see much upside left for the bulls here. This wave 5 up looks tired already and the market isn't even open yet. Can it take out the high of the wave 3 at least? I just don't know? But the bulls need to get going soon or another drop is going to follow next week. But a strong thrust up into the close on Friday could negate the repeat of the pattern as they would no longer look similar. Happy Trading Today.

Yesterday was really the bears best chance to drop the market but they failed in my humble opinion, because it should have been an "all down day" if follow through today was the plan. But the bottomed around 1pm and went up some and then back to sideways into the close.

I decided to exit my shorts (for a loss) as the market just didn't look ready to drop hard yet. This morning we see the futures down a few points but mostly flat. This run up from the 6/3 low looks a lot like the run up from the 3/8 low, whereas back then it first peaked on 3/19 and broke-down that day and bottomed the next day or 3/20... which would be like today.

Then it ripped up on 3/21 for a slightly higher high in what appears to be a wave 5. I say "appears" as while the wave 4 down was clearly the 3/19-3/20 pullback the wave 2 is hard to find. But my best guess would be a sideways wave 2 that happened on 3/12, then a wave 3 up into 3/19. My thinking is that we are today where 3/20 was back then. The pattern looks very similar. Even the MACD's look similar from then to now as well.

So if we can close just slightly down today then the pattern would be perfect. It would suggest a wave 5 up tomorrow that takes out the current "recent" high of 2910 or so by maybe another 10 points I'd guess. Nothing is ever an exact match but this one is close on this 60 minute chart.

It varies a little when I look at it on a 4 hour chart. The MACD's there where much higher today then on 3/19-3/20 drop, which I'm not sure what to think about it? It might mean that a deeper drop is coming after the 5th wave up finishes because the MACD's have to fall further to reach the neutral line where the commonly turn back up.

We'll cross that road when we get there. For today I'm looking for a very small red close on the SPX/DOW to setup a nice rip up tomorrow for a wave 5... which should finish this up move and setup a nice move down to follow. How far is the big question I can't answer just yet but again... one step at a time. Happy Tuesday.

On IWM there's and afterhour "possible" FP of 152.82, which is close to getting hit here in the premarket session. I suspect it will be hit and that will top it out as a lower high then yesterday to make a wave 2 up of some degree. If so, then it should start down at some point today I'd suspect (again, assuming it doesn't make a higher high then yesterdays 153.14 top).

This of course should apply to the ES Futures and the SPX/SPY too as they move together most of the time. I still think we drop to the lower FP on IWM mentioned yesterday in the coming days.

That FP was put out afterhours/premarket last Tuesday, June 4th... so we should see the rest of the market pullback to a similar level would be my best guess. When I look at the SPY it was in the 277 area, so that's the 2770's on the SPX and ES, which seems pretty far down as I know that other good traders and chartists are looking for a pullback to only the 2800 area. I guess if everyone is looking for the same area SkyNet will be forced to fall shy of it, or pierce it and run all the stops of bulls buying.

Everything seems super bullish right now but I have to believe in the FP's as they've been great over the years... very accurate. Problem is that I just don't know the "when" part? I can only guess at it and the reason I'm "guessing" it's going to happen before this week is over with is because of several factors.

First, we had a triple top that got pierced yesterday, so bears got stops ran on them for sure. This morning they are doing it again with the market up once more. Second, we had a prior upside FP from about 2 weeks ago that was hit and fulfilled yesterday. It's common for them to go past it a little bit but most of the time they stop and turn back the other way shortly afterwards. Third, we've had 5 green closes in a row on the DOW and it's overdue for a red close. Fourth, the VIX didn't really want to go down that much yesterday with the market rallying up. It seems to be trying to base and hold support before another turn up. It at least is saying the the upside is limited from here, if not also saying a turn back down is coming soon. So I remain short, and painfully short. Have a great day.

This Monday morning we see the ES Futures some but they were higher last night and fell back some and are now back up for a lower high. Was that a wave 1 down and wave 2 up right now before the open? Only time will tell.

I took a short on Friday so you just know that the futures had to go up this morning and try to shake me out. But I'm in IWM and it's not up much as the ES, so hopefully I'll be fine. I do think we'll get a pullback this week, and it should be just enough to shake out the bulls and lure in the bears.

Then we can go back up again and make another stab at the all time highs. When you look at it on a 60 minute chart the recent early June low looks like a "Head" and the May 13th low looks like the "Left Shoulder", so we just need the "Right Shoulder" to form now and then we can go up again.

This week might start off slow but odds are still pretty good for a low by the end of the week or sooner to make this right shoulder. For today though the futures seem to be stuck in a rising channel and might not breakdown at all today but instead gap down out of it tomorrow to fool the most. That's just me trying to think like SkyNet... hey, that would be a cool logo on a T-shirt! LOL. You know what? If I were SkyNet I'd take it up a little higher today (then the Sunday night high of 2898) to trick every bear that's thinking of shorting today. Then tomorrow I'd gap up again and do a full reversal and go down the rest of the week to shake out the bulls.

I hope that isn't the plan as I'm ready for it to drop asap but that certainly would shake some shorts out. I just feel that when a setup is too obvious (meaning a lot of good traders and chartists I follow are saying the same thing) it rarely plays out. A lot of people are probably shorting this triple top zone and maybe they need squeezed out first? I don't know? But I just can't buy this rally. I still think down first and then up again... and probably down again.

We could see a lot of moves up and down this summer before it breaks out to the upside in a trend or down side. These swings though are quite large so if you can catch them they are well worth playing.

Not much to add this morning gang as the futures are looking to open up higher again. This move up for the bulls has been met each day with some kind of intraday pullback so the bears are still alive and kicking. We are getting up into an area of tough resistance and Rose found a FP on the SPY pointing to around 288.50 to 288.75, can't tell for sure the exact level. So at the rate the market is going that level could be reached in a couple more days. This assumes it pulls back today again some early on and back up into the close to end the about flat or only slightly up, which is what it's done for several days in a row now. The biggest move seems to always be right off the bottom and then from there it's a grind-fest. My best guess is that we'll hit that FP by next Tuesday and setup another great short. It could happen earlier but if the market continues the grind pattern Tuesday would be the most likely date. I'll end this update now and keep it short. Have a great weekend.

The ES has gotten right into the prior resistance zone between to the two horizontal blue lines. This will be the real test for the bulls as a push through will squeeze out some bears, but likely exhaust the bulls at the same time and cause a reversal anyway. I'm showing you the upside down chart again to get a different perspective of the market. It clearly looks like a bear flag to me and gives me the feeling that it's going to push through that lower blue trendline.

That would be a squeeze on the bears short right now. The MACD's don't yet show any positive divergence on them so it's quite possible that we do get another push higher today (again, lower on this chart as it's upside down). It's really a tough one to forecast right here as there's a possible downside FP on IWM showing a low of 146.42 from Tuesday, but is it a real one or just a late fill? Only time will tell. There's lots of resistance overhead here but that doesn't mean the bears can't get squeezed first before dropping back down. For the record I took a short yesterday on IWM via a put spread.

I was up a little on it most of the afternoon, but this morning I suspect I'll be back to breakeven or down a few pennies as it's looking to open around the same level I short it at. The only good news with it is that it's making lower highs on each bounce while the SPY/SPX/ES is making higher highs. May thoughts are that we'll drop some today but it probably won't take out yesterdays low. If we chop like this today and even tomorrow possibly I'd guess that they plan on taking it up higher next week.

So maybe one more move down on Monday or so (like a C wave with today and tomorrow doing a choppy A and B wave), and then we go up into next week. I've just found that it's never that easy to have a move down (like the one from May 1st to June 3rd) that wakes up the bears, then a clean bounce to allow them to short the next drop. Most of the time the bounce is full of wild swings and fake out moves to prevent the bears from catching the next real drop. Anyway, have a great day.

This morning I want to get a different view of the ES Futures so I'm looking at them upside in this chart. It keeps you from being UN-biased as everyone tends to favor the bulls or bears from time to time and when you flip the chart you sometimes see it differently. The area that has my attention is the rising yellow trendline of resistance (which is support on a normal chart) and the parallel blue trendlines.

The market hit the first on in the 2820 area and is getting rejected as we watch it hear before the open. But with that yellow trendline so close now I have to think it will hold and the market will turn back again. Personally I'd love to see the market get into the blue channel and hit the lower line at 2840 to put in a top on this market and allow a drop on Thursday... which that yellow trendline would likely be the target again.

At the bottom you'll notice the MACD's are oversold (again, this is upside down so it's really overbought) and trying to rise up now. But I suspect they will turn back down at some point today to make a higher low and thus form a divergence. If the futures were to hit the 2840 area I'd have to consider a short into Thursday. Could it jump over that area and continue to 2850 or 2860? Sure, but that's why I want to see divergence form first on this 60 minute chart as that would increase the odds of the short playing out on Thursday.

From an EW count this move before the open is likely some wave 4 of some degree. So a wave 5 up to that 2820-2840 zone into the close today would be perfect for a short going into Thursday. That's what I'm focused on for today. Good Luck.

Yesterday around 1:26 pm there was a large volume spike on the SPY, which I posted a screenshot of the 1 minute chart in the chatroom. This wasn't a guarantee but suggested the Fed's were stepping in and stopping the market from collapsing further. Now we see the futures up nicely this morning before the open. This again tells me a bottom of some kind is in play now.

I don't think we are off to new all time highs from here but more then likely we are in for some choppy action for several weeks with an upside bias that could retrace half or more of the entire move down from the May 1st high.

This mornings' gap up will likely be shorted but I do not expect another lower low today. Instead I'd go with an ABC move up into mid-June with today's rally just being the first wave 1 up of that A wave. So any move down today that doesn't make a lower low (and I don't think it will) would likely be a wave 2 of an A up.

I kinda think that SkyNet will keep the market up today and not drop for that wave 2 down until tomorrow. It's what I would do if I were SkyNet and wanted to trick the most traders. I'd gap it up tomorrow to end the wave 1 of A up and shake out anyone shorting the close today (this again assumes we don't have the wave 2 down intraday today). At that point most would go long but if this plays out like I think the gap up tomorrow will be a short for a wave 2 down of A up.

This is how I'd do it if I were SkyNet. Why? Because anyone that missed the move down will short this open and keep shorting all day long looking for another move down. Then when it doesn't drop they will hold into tomorrow, but a gap up again in the morning on Wednesday would shake them out... and that's when it will roll over and do the drop for a higher low then yesterday. You can see on the chart the falling lower black trendline of a falling channel, as well as a falling green trendline and blue trendline just a little higher. So there's lot's of resistance in the 2780-2800 area, and that's my best guess on where this first move up will stop and pullback for some wave 2 down of A up. This is my best guess on what is coming in the next few weeks and days. Have a great day.

The futures are down a little this morning but nothing huge. I guess Trump didn't do anymore tweets over the weekend... LOL. This week I do think we are going to see tradeable setup appear. Maybe today, but I'm thinking more likely tomorrow. We either need a couple of more days down to flush out all the bulls so a strong rally can start, or we need to to a fake out, short lived rally today and tomorrow. If we flush out into tomorrow then I'm a bull and if we fake out I'm a bear.

A bounce today and tomorrow is a short I think as there's too many bulls still buying this drop. And there's not really as much bearishness as you'd think. Even the bears are thinking a bottom is near and not shorting it. This move down has been a steady and well controlled one. The "fear drops" don't seem to exist much anymore.

Probably due to the fact that everything is now 100% computer traded with no floor exchanges anymore. This is also (most likely) the reason that there's not enough bearishness currently from this drop since the May 1st top.

I don't know how it's going to play out but if we get two days up in a row (into tomorrows close) I do believe that will be a fake out on the bulls and another large drop will follow. But if we drop again today and tomorrow then I think SkyNet is going to take it back up later this week. However, with that scenario I think the move back up will be very choppy and last about 3 weeks to frustrate both sides. It would make a nice bear flag on the daily and should retrace at least half of the move down.

So the 2850 zone at least should be reached if this is the plan by SkyNet. Personally though I'd rather see it do another large drop to get this over with so it can start a rally up to new all time highs the rest of the year. But SkyNet never gives me what I want so more then likely we'll drop some today and tomorrow and then start a choppy 3 week rally back up before this larger drop occurs and takes us down to my 2450 SPX target zone. It sure would be nice to get it started later this week with a fake out two day rally up but I'm not holding my breath on it. Regardless of which one happens today isn't likely to be too exciting. Have a great one.

The futures are set to open down sharply this morning as the bulls just can't seem to get anything going to the upside.  And it doesn't help when Trump keeps tweeting about tariff's.

“Tariffs will be raised to 10 percent on July 1, 2019. Tariffs will be increased to 15 percent on August 1, 2019, to 20 percent on September 1, 2019, and to 25 percent on October 1, 2019.”

No doubt the drop this morning had a lot to do with that tweet...

It's been a series of small rallies and bigger drops with little opportunities for bears to see it coming and get short in front of it. Everyone is looking for a strong rally back up to short at but SkyNet doesn't seem to be willing to give us one (or Trump just can't stop tweeting). I too have been looking for a strong short setup (or long) to form but the trickier of these moves keeps it a guessing game.

I really was hoping for some sideways to slightly up movement for 3-4 days to make a nice bear flag on the daily chart so a "clearer to see" short setup could form.  But again, we just aren't getting anything clear at the moment.

Odds did favor down today versus up but not by a huge amount, so I remained neutral going into today and missed this nice drop (if Trump would just call me first before he tweets, that would be nice). The downside is never easy to play as just when you think it's time to short that's when a powerful squeeze happens. On one hand I'm glad I'm in cash and not trapped long but on the other hand it sucks missing these big moves down.

Clearly today's drop is a strong one and likely some kind of wave 3 or C down, so I don't see it reversing back up hard in some squeeze right at the open, but I also am not interested in shorting it after such a large drop already. It might bottom at the open and do a small wave 4 up bounce and back down into the close for a wave 5, or it could just continue down deeper in a slow steady move into the close. I just don't know?

Sometimes I get a good feel for the market and I'll tell you when I do. Other times I'm out of sync and don't know... and this is one of those times, (or I get hit with a surprise tariff tweet), which is why I'm not in any trade currently. Sorry I can't offer more then that. Maybe next week something will appear with higher odds? Have a great weekend.