Another downtrending price bar was formed on the cash S&P500 daily chart as the one day upward price pulse from the 11/20 low ended at Tuesday’s high and we have a new downward price pulse developing from that point.
Since we made a new low on Wednesday I canceled my buy stop order on the SPY. My analysis still contains many elements that point to a market poised to reverse but those may slip away without a strong showing by the bulls on Friday. The latest chart still shows possible bullish divergence between price and Wilder’s RSI. The main difference between now and Wednesday morning is that, unless we turn upwards, it is only “possible” divergence. Price continues to be in the target zone identified on the weekend post of November 10-11. On November 8th I wrote “My next Fibonacci clusters are at 1461-1463 and then 1413-1417. … From the recent high I have Gann Wheel targets at 1469.5, 1459.5, 1437, and 1421.” Yesterday’s low was at 1415.64. You can see these targets on today’s chart. The possibility that we might be in the latter stages of a Terminal Impulse pattern also remains.
There are growing negatives. A huge concern is this week’s developments on the weekly chart. Granted we still have Friday’s abbreviated action to turn things around, but right now the weekly is at a new low (closing basis) from the July peak along with the technical indicators. I’ll examine the weekly chart (over the weekend) before deciding on whether to take any trading positions.
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