SP500 – Daily Analysis
SPX came dangerously close to invalidating a major wave structure. Will it hold—or is it time to make big adjustments? In this SPX technical analysis, we break down the outlook across multiple time frames, aligning candlestick patterns, momentum signals, and key support/resistance to define risk, outline the highest-probability paths, and map the next tactical moves.
CANDLES
The index (and the market) is indeed in danger. SPX finally confirmed a top on the daily and lost the 8 EMA support. The same can be said about Nasdaq and RUT. RUT is the most bearish among all after forming an 8/20 EMA bearish cross today by 2 bp and losing the 50 DMA support. Dow Jones is undecided. The bearish stance is confirmed only on the daily frames for all. All larger frames are still holding bullish.
At the same time, SPX and NQ are strongly diverging on multiple hourly frames after being oversold. There is a significant chance of a bounce tomorrow.
Considering these factors, tomorrow will be pivotal for the 2D momentum, and potentially for a larger reversal. If bears lose, the next leg upward could start.
Short term: SPX — bearish
Mid term: SPX — bullish
Long term (15D and larger): SPX — bullish
Elliott Waves
Short Term
Bears were impatient last night and completed a truncated flat instead of a triangle. That truncation fed the downside and a clean impulse appears finished for wave (c) as of writing. There’s a chance the entire correction is complete and the next leg higher is starting; in that case, I’d treat the formation as a bullish flag with a targeted move of roughly 250 points, give or take.
The absolutely pivotal must-hold for ES futures is $6,766.75. A break below that level—equivalent to $6,724.12 on SPX—would invalidate a major impulse and shift focus to bearish paths from here. A pivotal night is ahead.
Possible Flag – if $6,766.75 holds!
SUMMARY
The SPX and other majors confirmed tops on the daily frames. Russell—often the canary in the coal mine for major market moves—is the most bearish after the 8/20-EMA bearish cross. Surprisingly, none of the larger frames have confirmed bearish signals, and 2D momentum readings arrive tomorrow.
Tonight is pivotal for the major EW impulsive wave. A move below $6,766.75 by ES futures would invalidate the structure and open multiple bearish paths. We’ll likely know the outcome by morning.
Short term: SPX — bearish
Mid term: SPX — bullish
Long term (15D and larger): SPX — bullish
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Happy Trading!
