SP500 – Daily Analysis
SPX dropped today. Was it just a correction, or the start of something bigger?
In today’s Daily Report, we break down the market’s internal mechanics, track the signals developing across key timeframes, and pinpoint the levels that could decide the next major move.
CANDLES
All indices made bearish signals today. SPY confirmed a reversal on a Harami Cross. DIA and IWM formed full Bearish Engulfings. QQQ was also bearish, but a notch less powerful. There is a very high probability of lower prices tomorrow, and we will be looking for bearish momentum and losses of major supports.
The 15D frame closes today with a strong bullish reversal signal, similar to the one in 2025.
The weekly has started a pullback, but the move is not concerning yet. It will become concerning if, or once, the price approaches the 8-week EMA support. We are keeping an eye on it.
At this point, the short-term outlook is bearish. The mid- and long-term outlook remains bullish until signaled otherwise.
Elliott Waves
Possible Impulse
At the micro level, the impulse completed an i-ii or a-b structure. The current wave down is either c in green or iii in blue. There is also a chance for a gap.
I measured the parameters of the first wave off the top using some alternative tools and extrapolated the results. There is a fair chance that the very first wave off the top, i or a, was an impulse. Let’s see what kind of wave the current move down morphs into tomorrow.
Mid Term
Both the green and purple counts remain on the table, with the purple count still primary for the technical reasons discussed on April 15.
When comparing all major indices, the wave divergence between NQ/SPX and the Dow remains the main unknown. As discussed in the weekly report, the Dow has not made a new ATH yet, and it has more inherent risks.
SUMMARY
SPX turned bearish in the short term after all major indices printed reversal signals, with SPY confirming on a Harami Cross and the broader setup pointing to a high probability of lower prices and growing bearish momentum. On the micro level, the current decline is likely the next leg of the structure, with the wave down tracking as either c in green or iii in blue, while the first wave off the top may itself have been impulsive.
At the same time, the bigger picture has not broken. The 15D closed with a strong bullish reversal signal, similar to 2025, and the weekly pullback is not concerning yet unless price starts approaching the 8-week EMA. Overall, SPX is bearish short term, while the mid- and long-term outlook remains bullish until signaled otherwise.
