At weeks end the S&P 500 lost 3-pts for the five trading sessions, albeit taking a sizable dive on Tuesday and having a sizable rebound on Thursday. Although price hasn’t moved a great deal in terms of direction, we’ve been left with one positive technical signal and another developing bearish pattern. The positive technical signal was a reversal back above the June 17 lows reversing what could have been a southbound 5-wave impulse. What we’re left with though is a 3-wave counter trend move which as we know is corrective. In other words it increases the chances that what we’re currently seeing is a period of congestion before renewed strength higher, at least from an Elliott Wave perspective. On a classical technical level we also have what appears to be a developing Head & Shoulders pattern, a bearish formation that confirms on a close back down through 888.5. Therefore this now becomes our important focal point. The daily trend is up, just, and the daily momentum in completely neutral. Below 888.5 we go near term bearish. Follow through strength early next week will be a strong sign that the next up leg has begun and we want to position ourselves accordingly.
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Suite 1/ 21 Sleepy hollow Drive
Noosa Heads QLD 4567
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