I was a little surprised yesterday when the market broke upward through that falling trendline of resistance as I kinda thought that would happen after the FOMC today. But the rally up has faded this morning so I can only guess that SkyNet didn't want to lose the 2960's as possibly it's more important to the bulls then expected. As far as wave counts, it's getting hard to figure out now. We might have completed the ABC move down at the low yesterday and now we are in a up move of some degree. Whether it's a wave 5 up or just a B wave up (with the ABC down being some A wave) and C down yet to come is just unknown. It's times like this when things get tricky and hard to figure out.

I really don't care if it goes up or down as I'd be more then happy to play either move, but this chop is hard to trade, so I don't. Overall though we know the market is rigged for the bulls so trying to see and catch a good short is very hard... which is why I'd be just as happy (actually, I'd be happier) to see and catch a long setup. Lot's of people are talking about a megaphone pattern that the market is in on a daily chart, which points to a blow off move up. I don't know if it's that easy or not but I do think SPX wants 3000 and it's only hit 2995 while the ES Future has hit 3006 already. Plus Amazon seems to want to hit 2000 again, (written before 8:30 am).

And just as I'm typing the futures spike higher and turn green. I guess some economic news must have been released? I remember in the old days everyone focused on the Non-Farm Payroll Report as it would move the market all the time. If I recall that came out on Thursday or Friday at 8:30 am. So maybe this wasn't some economic news released but something said positive by the Fed or a new Trump Tweet? Whatever it was the market loved it as the squeeze is on now. I don't expect today's close to setup any high odds trade as I think we need to get past this FOMC crap and let the market settle down for a few days to see its' real intentions. So maybe by the end of this week it will show its' hand? Best of luck trading.

I have to do so things this morning so I'm writing this daily update early as I won't likely make it back by the open. We are very close to a pullback in my opinion. I'd like to see a sideways day with light volume and a small green close. A nice "doji" daily candle would be ideal I think. If we instead rally up too much over 3000 on the SPX Cash (hit 2995 on Friday as a high) then I'd start thinking another squeeze up for awhile longer is going to take place.

If the bears can limit the strength today and still allow a green close on at least the DOW, but SPX preferably too, then I'd expect the pullback to start on Tuesday. But if we get over about 15 on the SPX and over 80 points on the DOW I'd stand pat and do nothing as it could setup another push higher to squeeze the next level of shorts. Basically I'm trying to find the end of this 5th wave up, which the 1st wave started at the 2728 low. If we get the "slightly green" close today without going up too much then I'd say the wave 5 up has high odds of it being completed and ABC pattern down starting.

The move down could be any Fibonacci Level, but the most common would be from 38.2%, 50%, or 61.2%, and that would be measured from the high of whatever tomorrow (not more then about 3010 max) down to the 2728 start of the entire 5 wave move up. Rough guess would be in the 2850-2900 area, and time frame should be 2-3 weeks. After that it's back up again with more new all time highs expected. But I'll worry about that after first catching this move down first. I'll be back as soon as possible today an in the room for sure by close, as that's when I'd make the decision to short or not. Happy trading.

Hope everyone had a great holiday yesterday. Today I expect light volume as many traders will likely be taking today off as well. The futures are down some, which is to be expected I guess with the exhaustion move up yesterday to finally make all time new highs on DOW of 26,966 (nice triple 6's there... top signal?). I don't have much to add today as it's looking like any sell setups we had are going to be pushed out into next week. The DOW making a new all time high caused this. So I'll keep it short and just wish everyone a happy extended holiday.

P.S. If the market pulls back too far today it will likely kill any sell setups for next week and allow another big push higher... like maybe even 3100 on the SPX? Hard too say for sure but too deep of a drop today is bad for the bigger pictures for the bears.

The futures are set to open slight up this morning. Don't forget that it's half day today due to the market being closed tomorrow for the 4th of July holiday. So light volume is very likely until the 1pm EST close. If we get any move down of significance it would shock me. Most likely a nothing day. However, we get get a new FP on the SPY yesterday. It was a downside one for 291.21, which is likely the target on the next move down.

If we drop to that level today or Friday I'd call it a C wave down where the A down was started at the open on Monday to the late day low where the B up started and continued into the close yesterday. After that ABC down completes I'd expect another move up. How big will determine whether it a 5th wave up to a new all time (again for the SPX, and/or the first time for the DOW) or just a lower high that setups another ABC series of waves down. If lower higher then we could start a really nice move down next week.

Basically this first ABC series down wouldn't be a wave 4 of some degree then (everyone I follow and read are expecting a 5th wave up to 3000+, so I'm sure they are calling this move down a wave 4). Instead, the first ABC series would just be a larger A wave, and once finished (at the 291.21 FP?) a larger B up would happen. Then another ABC series down next week for the larger C down. This would mean that the high is already in on this past Monday at the gap up open.

So everyone expecting 3000+ would miss the drop and be forced to chase it down, and we all know that SkyNet never makes it easy for traders to get short or long at the best spot. So if the DOW fails to make a new all time high on the next move up, then the SPX should fail to take out Mondays high too, and certainly not reach 3000+, and that's exactly what I'd do if I were SkyNet. All just speculation at this point. Really not much else to say about today.

But Friday could be interesting, especially if we get that move down to the FP level and start a move back up for that larger B into the close Friday or early next week. Things "could" get interesting for sure next week. A move down into mid-July could go deeper then most expect. I'll play whatever is given to me, so if the market wants to go up in a 5th wave first I'm completely fine with that too. It's a flip of coin now, but that downside FP has high odds of getting hit soon to complete an ABC down move of some degree. Have a great holiday tomorrow.

Exciting day yesterday... for the bears I mean. That opening pop that got faded all day long and didn't turn back up until around 3pm is quite bearish in my view. If the bulls really were going to run this pig up to 3000+ on the SPX the pullback should have been much smaller. In fact they should have held the opening range and went sideways all day to make a bull flag.

But the bears attacked and pushed the bulls back down nicely. The DOW never did make a new all time high while the SPX already has, which is a divergence between the two indexes... and it's bearish, not bullish. Over time I'm sure the DOW will make a new high but right now it's struggling and that tells me a nice pullback is more likely to happen soon versus a breakout rally. There's also the gap on the ES Futures that came within 25 cents of getting filled on that pullback.

Gaps on the SPX happen all the time but on the futures they are rare, and they always get filled at some point. Just the fact that the futures dropped back to that gap fill area and failed to fill it tells me we will be going back down at some point soon. There was a possible FP on the SPY afterhours yesterday showing a low of 293.29, so if that gets hit today, tomorrow or Friday the gap on the ES will also get filled. As for today, it's anyone's guess.

The futures are mostly flat right now so I'm not sure what the plan is today... up or down? Should be light volume though as we are getting close to the holiday and the market should go to sleep. Hopefully it floats up today so a nice sell can setup in a day or two. A move down to that FP could kill the sell as that would be a wave C down with yesterdays drop the wave A down and the rally into the close a wave B up. So if you are a bear you'll want to root for a few days of chop to upward so a bigger drop (then the FP) can setup... maybe as early as tomorrow?

But ideally on Friday would be perfect. I just don't want to see that FP level hit today as that might be too low and end the 3 wave move down, which then could setup another move up that could take out the all time high on the DOW. Preferably I'd like for that to hold, but we'll see. Anyway, no opinion on today. I'm just rooting for the FP NOT to be hit until tomorrow as this B up needs more time I feel. Have a great Tuesday.

I was looking at going long last Friday at the close when the market was drifting down slowly into 3:30 pm, and then BAM, out of no where it rips higher that final 30 minutes into the close. I missed it and wasn't going to chase it as I didn't know the reason for the move at the time and therefore didn't trust it. Of course it was related the G20 I'm sure now, so those people that bought it are sure happy this morning I'm sure. Very frustrating to have missed that move!

For today I really don't expect much but some sideways action with "maybe" a little more upside. This whole week is likely to be a boring one with Thursday being closed for the 4th of July. My eyes will be focused on the DOW as it has yet to make a new all time high like the SPX did previously.

If it does take it out this week then the bears are toast for quite a long time. Not saying there won't be pullbacks but I am saying that the market will be in some strong wave 3 rally up and the summer grind is likely to kill the last bear. But if the bears can stop the DOW from making a new all time high then they have a chance at a nice move down.

Personally I think the bulls will win, but maybe not on this attempt. Possibly it plays out like what Tony Caldaro's group is looking for... which is SPX 3002 to complete what they call "Minute Wave 1" up inside "Minor Wave 3" up? Elliottwave is tough in predicting the future moves but Tony was probably the best at it, and had the highest accuracy of anyone I have seen. That's what they are looking for, which should (possibly?) put the DOW at a new all time high by a little. And that could be the plan by SkyNet... to pierce the all time high so the super bullish wave count can be locked in? Then pullback some Fibonacci level of 23.6% or 38.2% for "Minute Wave 2" down. On the SPX that would be from from the 2728 low up to that possible 3002 high, which is 274 point.

A 23.6% pullback would be 64 points or a pullback to 2937 or so... which seems too small to me, but anything is possible in a bull market I guess? The 38.2% level would be 104 points down, which would be 2897 or so on the SPX. Now that sounds more likely to me as it's a pierce of 2900, which should get the bears super excited thinking the world was ending... only to see it turn back up and start a wave 3 of 3 to stupid levels.

These are just speculation right now but if we get up to that 3000+ zone that's where we'd want to see the move up end and start this pullback.  With this week being a holiday shorten week it wouldn't surprise me to see the drop start Wednesday or Friday and end by early next week. Lately (the last several years that I've noticed) "they" seem to do this pullbacks (controlled of course) during holiday periods when many traders are taking time off. So that what I'll be looking for this week, a top for Minute Wave 1 and the start of Minute Wave 2 down. Happy Monday.

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.