S&P has been
trading sharply lower last week but now showing some evidences of a low around
1625 area which is fine because we already have five needed sub-waves down in wave
(A). We know that after every five wave move correction is expected, so
recovery or sideways price action in this week should not be a surprise. We are
talking about blue wave (B) that could already be underway and may even reach
1667 area before the Friday's US NFP. After wave (B) pull-back we will be
looking for a strong sell-off in wave (C), into a third leg of decline.
S&P 500 4h Elliott Wave
Analysis
The important
thing that we need to understand now is a five wave of decline from 1705, which
means that bearish reversal on stocks is confirmed and that prices will stay in
bearish mode for few more weeks, and that any bounce will be temporary and
limited with 1705.
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