SP500 – Daily Analysis
The S&P 500 is analyzed through a multi-frame approach that combines candlestick patterns, technical indicators, and Elliott Wave structures. This framework helps identify shifts in momentum, assess the strength of prevailing trends, and outline possible paths across short-, mid-, and long-term horizons. Today’s daily update follows this method to interpret the latest market signals and define key levels for the next move.
CANDLES
Today, both SPX and ES had a chance to close daily candles above yesterday’s high, but they did not. This is a concern, as the move was not sufficient to fully negate the Bearish Engulfing formed yesterday in both the index and futures. DIA and IWM were in the same bearish camp, though with different combos. Nasdaq was the only one to close at a new ATH. Will that be enough to maintain bullish odds across the market tomorrow?
Short term: SPX — neutral
Mid term: SPX — bullish so far; high risk of flipping, watch the Friday’s close
Long term: SPX — bullish
Elliott Waves
Mid Term
No changes yet to the mid term. The purple count remains primary and the green count stays on the chart.
Short Term
At the micro level, ES held $6,743.50 and technically completed a 1–3–5 impulse up, forming the minimum number of waves needed. Wave 3 was unusually short but still longer than wave 1. This spot would make wave (iii) exactly 1.618× the length of wave (i), one of the most typical ratios. If so, we can expect a rather shallow pullback into the wave iv area, possibly covering the entire length of wave v of (iii).
Micro Level – All Indices
Let’s continue the musings I started yesterday for the micro-level study of the major futures.
Obviously, today’s higher highs invalidated possible impulses down for ES and NQ. YM failed to form an impulse up and most likely consolidated for wave (b). A very important message came from RTY—it failed to form an impulse down of a higher degree, and this is good. Until it makes a new higher high, the risk of a larger correction remains on the lower side.
While I was typing, ES and NQ began moves down that were suspiciously impulsive. If NQ forms the pattern I outlined above overnight, it could lead to a concerning day tomorrow. Let’s see how it evolves. If there is a strong bearish setup, I’ll try to post an update early tomorrow.
SUMMARY
SPX failed to fully negate the bearish odds on the short-term frame, nor did it confirm them. The stance is neutral, with the risk of momentum bleeding into larger frames. The end of the week will be pivotal for confirming direction.
Short term: SPX — neutral
Mid term: SPX — bullish, risk of change this week
Long term: SPX — bullish
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Happy Trading!
