SP500 – Daily Analysis

S&P 500 bounced exactly where it needed to, but the real question is whether this move has strength beneath the surface or is just another temporary reset before the next decline.

In today’s technical analysis, we look past the headlines and examine the latest candles, momentum signals, market structure, and key target zones to assess the health of the bounce and define what comes next.

CANDLES

S&P 500 formed a daily candle that could become a bullish Harami after adequate confirmation. However, the strong confirmation of at least a short-term top on the 2D and 3D frames, along with a very clean Bearish Engulfing on the 6D frame, sharply reduced the potential bullish odds on the daily frame. The best case I can see is another attempt to flip the odds bullish tomorrow, and that would likely be it. Wednesday aligns as a highly probable day for another drawdown.

Overall, the short-term outlook for SPX is neutral-bearish, while the mid-term outlook is solidly bearish.

Elliott Waves

Last Wave

Today’s bounce was very likely corrective and could be viewed as wave iv of (iii) in red. There are two other options: wave a of alt iv, or wave (a) of B in green. Since there is a fair chance of another bounce tomorrow, the exact level it reaches will be critically important. At this point, all options remain on the table.

Nasdaq

Nasdaq is somewhat similar to the S&P 500 and could potentially form wave B as a sizeable zigzag. The overall odds are on the bears’ side, but the path is not very clear.

Live Trading Room

On Friday, our LT Room reduced the position to 25% Long and kept it unchanged at today’s close.

SUMMARY

SS&P 500 bounced as expected today, but the move still looks corrective rather than impulsive. The daily candle could potentially become a bullish Harami with adequate confirmation, but the broader evidence remains heavy. The 2D and 3D frames have already confirmed at least a short-term top, while the 6D frame formed a clean Bearish Engulfing, sharply reducing the bullish odds on the daily frame.

From an Elliott Wave perspective, today’s bounce could be wave iv of (iii) in red, wave a of alt iv, or wave (a) of B in green. Another bounce attempt tomorrow is possible, but the exact level reached will be critically important. Wednesday continues to align as a highly probable day for another drawdown.

Nasdaq is somewhat similar to the S&P 500 and could potentially form wave B as a sizeable zigzag. The overall odds remain on the bears’ side, although the exact path is not very clear.

Overall, SPX is neutral-bearish short term and solidly bearish mid-term. Our LT Room reduced the position to 25% Long on Friday and kept it unchanged at today’s close.