SPX: Follow Up of the Short Term EWP
Sorry but today I have personal matters to take care so this is just a brief update.
The US presidential election euphoria vanished abruptly aborting the scenario of a larger bounce with an Ending Diagonal or a more time consuming sideways Triangle.
I modify the count of the corrective move from the September 14 high from a Double Zig Zag to a Triple Zig Zag. The end result is the same but with a TZZ. I can include two potential short-term scenarios from yesterday's hod: either an impulsive decline (blue count) or a Zig Zag (black count).
If this count is correct price will unfold either an impulsive sequence or a 3-wave down leg. One of these two options should establish the end of the correction.
With yesterday's sell off we finally have price inside the Target Box.
We have an eod print below the September 4 reaction low = 1396.56 and the 0.382 retracement = 1395.
The trend line in force since the October 2011 was tested but not breached, but I doubt it will hold the next down leg.
Yesterday's strong selling has pushed TRIN into oversold territory hence odds favor a rebound attempt for today. If this is the case, it should fail in the range 1411 - 1416.
Given the positive divergences of breadth indicators and since price is already inside the potential target range of a multi-week/month bottom we have to be extremely vigilant in order to detect the move that is expected to complete the EWP.
The McClellan Oscillator seems to be unfolding a contracting pattern that could be the springboard for a bullish thrust if the sequence of higher lows is not aborted.