S&P 500 EOD Review 4 Jan 2012

The S&P 500 is looking toppish and a downwards correction is expected soon. The MACD on the hourly as well as daily is diverging and this is a clear sign of losing momentum. My take is that we are in the final stages of this move up.

The question is whether is this going to be a deep correction or a shallow correction. If the support red line at 1225 is broken, the market could head much lower. If the red line holds, we could see higher levels of 1400 or even 1500.

S&P 500 EOD Elliott Wave Chart 4 Jan 2012

S&P 500 Fibonacci Confluence

The S&P 500 touched the next big Fibonacci band at 1282 – 1293 and turned down. We can expect one more push up to touch this band again before sliding down.

S&P 500 Daily Fibonacci Chart 4 Jan 2012

S&P 500 Volume

The volume is very light and is typical of market turn points.

S&P 500 Daily Volume Chart 4 Jan 2012

S&P 500 EOD Review 28 Dec 2011

Another indecisive day with low volume. The trading range is getting very narrow and would likely remain so until next week when most people come back from their holiday. The S&P 500 would likely stage a major move then. But it could go either way so caution is needed.

My count is still labelling the move up from 19 Dec 2011 as a Subminuette b and Subminuette c is underway to 1205 region.

S&P 500 EOD Elliott Wave Chart 28 Dec 2011

S&P 500 Fibonacci Confluence

The S&P 500 pierced through the Fibonacci band at 1252 – 1255 and came back down and closed right below this band.

S&P 500 Daily Fibonacci Chart 28 Dec 2011

S&P 500 Volume

The volume is very light with a lot of people still in holiday. Any major move can only be expected next week.

S&P 500 Daily Volume Chart 28 Dec 2011

S&P 500 EOD Review 23 Dec 2011

It looked like another lacklustre day but if we take a look into the details, one can find subtle indications that gives us valuable insight into the market. Firstly, the 200 MA was breached and the market closed higher that the 200 MA. This is a bullish move but the volume is very low which means that this move is not going to hold. It also closed above the red line that has formed since early July 2011. This also looks bullish but it is most likely a throwover which is quite common.

I’m expecting the S&P 500 to head lower from here to 1225 or 1200 region. This move up is likely the Subminuette b of Minuette (x). After this, we can expect Subminuette c to kick in. Only after that, we can expect the Minuette (y) to bring the S&P 500 to 1370.

The MACD is diverging which is also another indication that the momentum is waning and is likely to result in a downwards correction.

S&P 500 EOD Elliott Wave Chart 23 Dec 2011

S&P 50o Fibonacci Confluence

The S&P 500 is sitting between two major bands. This is the same situation it was in in early Nov and early Dec.

S&P 500 Daily Fibonacci Chart 23 Dec 2011

S&P 500 Volume

Volume was very light and this is typical character at major market turns. It looks very likely that a top is in for this move.

S&P 500 Daily Volume Chart 23 Dec 2011