Let me explain my take where the market is going. This is the speculation department. First the SPX weekly chart:
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You will see the magenta line coming up from a 666 low over a year ago and that the market has come down to that line now but has not breeched (but the week is not over yet and these prints are the weekly). Today the market breached the 1056 pivot and this is very bearish. I have drawn in a spceulative downdraft line that bounces on several support areas (grey lines), but ends up at 815 at the horizontal red line. In terms of time, this scenario shown is by November 1. Now the technical of what I am thinking. First this is a corrective pattern from the top (head at 1220). The corrective pattern is a ABC correction in 3 primary waves. Remember Elliot waves go in sets of 5 up and 3 down for a total set of 8 in each sequence. I now believe primary wave 1 down ended at 1011, wave 2 at 1129 and now the terrible wave 3 is underway. I believe this will probably unfold in 5 subwaves something like I have shown, but again this is speculation. Also we could slide down steep as I have shown, or more gentle in the green channel well into next year, instead of concluding the downdraft by early November. At any rate, here are numbers: wave 1 1220 to 1011 is 209 points. wave 2 1011 to 1129 is a 0.56 retracement, a slight overshoot of the 0.50 FIB number. Assuming primary wave 3 is 1.5 primary wave 1 (0.50 Fib, and we know that wave 3 will usually extend and by a Fib number, so I took the middle value between 0.382, 0.5, and 61.8); then 314 points from 1129 =
815. As a check we take the head and shoulders pattern distance above the neckline at 817 (white line) or 203 points and subtract from the neckline and we get
814. That checks pretty close to 815 and is my target. BTW the H&S target, and cross check with Elliot wave is a higher low from 666, but at a much more gentle slope.
Stay tuned for more downside action, or a mini-crash?
