S&P 500 Monthly: Bulls now on the defensive ...
1) Bearish 'Island Reversal' pattern evidenced on the Daily Chart (June 4th gap up and June 10th gap lower, leaving
the 'Island' behind), still intact.
2) Bearish Weekly reversal bar the week of June 8th - 12th vs the preceding week on the Weekly chart wherein the
market opened higher than the prior week's close, then proceeded to trade higher than the previous weeks high, then
lower than the prior week's low before closing below the prior weeks close.
A clear 5 wave count down on the Daily chart is visible from the June 7th recovery high, followed by a 3 wave count
recovery into the June 18th high with another smaller 5 wave count down now visible from there. Given that the longer
Daily momentum measures are trending down now and not showing any signs of bottoming as yet and are nowhere near what
could be even remotely considered 'oversold' territory, the odds would seem to currently favor lower prices still
with a larger '1-5' count unfolding (allowing for a rebound attempt that fails to take out this past week's high of
3154.90).
However, as stated previously, in order for the Bears to declare victory over the Bulls, 2 goals must be scored:
1) On the Monthly chart, the market must trade below the marked minor 'a' high of 2954.86 to remove the possibility
that the minor 'b' can be counted as a '2' pullback in a bullish '1-5' count up.
2). On the Monthly chart, the market must trade below 2766.64, the low of the larger 'b' wave to remove any
possibility that the market could further sub-divide in a larger '1-5' bullish count up.
Immediate trendline support and resistance ranges on the Daily chart are as follows:
Support: ~ 2917 down to 2886.
Resistance: ~ 3077 up to 3133.
The risk of an accelerating dynamic gap down will increase on a failure to take out this past weeks high of 3154.90.
Mind the 'killer gap' down ... ?
the 'Island' behind), still intact.
2) Bearish Weekly reversal bar the week of June 8th - 12th vs the preceding week on the Weekly chart wherein the
market opened higher than the prior week's close, then proceeded to trade higher than the previous weeks high, then
lower than the prior week's low before closing below the prior weeks close.
A clear 5 wave count down on the Daily chart is visible from the June 7th recovery high, followed by a 3 wave count
recovery into the June 18th high with another smaller 5 wave count down now visible from there. Given that the longer
Daily momentum measures are trending down now and not showing any signs of bottoming as yet and are nowhere near what
could be even remotely considered 'oversold' territory, the odds would seem to currently favor lower prices still
with a larger '1-5' count unfolding (allowing for a rebound attempt that fails to take out this past week's high of
3154.90).
However, as stated previously, in order for the Bears to declare victory over the Bulls, 2 goals must be scored:
1) On the Monthly chart, the market must trade below the marked minor 'a' high of 2954.86 to remove the possibility
that the minor 'b' can be counted as a '2' pullback in a bullish '1-5' count up.
2). On the Monthly chart, the market must trade below 2766.64, the low of the larger 'b' wave to remove any
possibility that the market could further sub-divide in a larger '1-5' bullish count up.
Immediate trendline support and resistance ranges on the Daily chart are as follows:
Support: ~ 2917 down to 2886.
Resistance: ~ 3077 up to 3133.
The risk of an accelerating dynamic gap down will increase on a failure to take out this past weeks high of 3154.90.
Mind the 'killer gap' down ... ?
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