SP500 – Weekly Analysis
The S&P 500 just printed signals that could define the next major move.
After closing the first week of April with a seemingly constructive setup, the key question is unavoidable: is this the foundation of a sustained recovery—or just a larger Dead Cat Bounce?
The answer lies beneath the surface—and the implications could be significant.
CANDLES
The S&P 500 closed March with strong bearish signals on the monthly and quarterly frames, further increasing bearish momentum across larger timeframes. Against this backdrop, the bullish attempts on the daily and weekly at the start of April lack conviction and require confirmation, at least on the weekly frame.
Until such confirmation appears, the short- to mid-term outlook remains neutral, while the 10D and higher timeframes continue to point to an increasingly bearish long-term trend.
MACD
In mid-February, we discussed the MACD momentum turning bearish up to the 10D frame. Since then, the negative momentum has expanded to the 31D frame—larger than the monthly—and continues to build steadily. At this point, the current correction no longer fits within the technical boundaries of the 2025 pullback and is increasingly resembling the structures seen in the 2022 or even the 2008 bear markets.
22-Day Frame – Candle Estimate
On March 6, SPX recorded a strong Bearish Engulfing on the 22D frame, and I provided an estimate based on historical evidence. Details can be viewed here: https://investingangles.com/r1i6. The estimate stands.
Elliott Waves
Long Term Outlook
(no change in this section)
Back in June 2025, I introduced this long-term outlook, projecting the developing wave to end between $6870–7770 (ES futures). The move off the 2025 low completed at $7043, and the index is now trending lower.
A break below $6166.50 would likely lock in the structure that has been developing since October 2022, with the current move treated as wave 4. This would open a very wide corrective range between $6166.50 and $4808.25 — roughly a 31% decline.
The $4808.25 level remains extremely important, as discussed back in June 2025. A touch or break of this level would suggest that the index is working on a much larger correction, potentially wave (2) in red, with a path toward the 2020 lows.
While this red scenario is still premature, it is a risk that should not be ignored.
Mid Term
I am still tracking both the green and purple counts on the mid-term chart. However, given the long-term structure discussed above, a break below $6166.50—the key watershed level for ES futures—would open the path for the blue count, making it the primary scenario.
Once a clear signal is in place, the mid-term outlook will be updated to align with the long-term structure.
The index remains very close to a decisive move.
Last Wave
On Thursday and Friday, SPY bounced with gaps, complicating the assessment of the wave structure. The formations on both the futures and the index remain unclear. We need to wait for the move to mature and reveal its true character in the first half of the coming week.
For now, the larger (ABC) structure in purple remains the primary guide, although wave (B) is expected to be more complex and likely take more time to develop.
SUMMARY
The S&P 500 has now completed the March and Q1 closures with strong bearish signals, confirming the shift outlined last week. The monthly and quarterly frames have expanded bearish momentum, reinforcing the view that the structure is transitioning into a larger and more prolonged corrective phase. The technical backdrop continues to align with major downturns such as 2022 and 2008, rather than a short-lived pullback.
At the same time, the first week of April introduced early bullish attempts on the daily and weekly frames. However, these signals lack confirmation and remain weak relative to the broader bearish context. The recent bounce in SPY, marked by gaps, has further complicated the wave structure, leaving the short-term outlook unclear. For now, the index remains neutral in the short to mid term, awaiting confirmation of direction.
From an Elliott Wave perspective, the larger (ABC) structure in purple on the last wave chart remains the primary guide, with wave (B) expected to be complex and time-consuming. Both green and purple scenarios are still in play on the mid-term chart, but the key watershed level at $6166.50 remains critical. A break below would activate the more bearish blue scenario and open the path for a significantly deeper correction.
Overall, the S&P 500 is at a decision point. While short-term stabilization is possible, the dominant technical and structural signals continue to favor further downside, with increasing risk of a broader and more sustained decline.
