$SPX: Bulls Can Rally to 6,270.

<<< Back to All Updates
<<< Macro Updates

$SPX $ES #Elliott Wave #trading setup

Traditionally I will start this weekend update from a very big picture looking at a weekly chart of S&P 500 cash index ($SPX):

SPX weekly chart

S&P has been working on a large top of either wave ( 3 ) or wave ( 5 ) up. In any of those cases that top is supposed to be followed by at least a large A-B-C down corrective structure targeting first 4,900 (in a subwave A down) and then 4,000 (in subwave C down).

The million Dollar question is whether S&P has made that top or can squeeze one more push higher before the large 20% corrective pullback starts.

To pin point the exact top we should focus on the very last segment of the rally, the five wave up structure off the Oct 2022 low:

S&P 60 min chart

Let’s zoom-in to a 60 min chart.
Because the drop last week made a higher low, bulls can make a bullish case. They can claim that the drop was a micro subwave -c- of a subwave (b) down of wave ( v ) up. That wave count allows bulls to produce yet another five wave up move targeting 6,270 – 6,300.

The invalidation level for the bullish wave count is 5,773.

Let’s now look at ES mini and that breathtaking short covering rally:

ES-mini 60 min chart

The best way to count that pop is a subwave -c- up of a corrective -a- up, -b- down (Friday morning drop), -c- up rally (the rally that started on Friday afternoon and concluded on Sunday evening). That wave count provides us with the same targets: target i = 5,791 and target ii = 5,752.

Now I will show you a bigger picture on 240 min chart and you will see connection between the bullish scenario for SPX cash index and this micro count of ES-mini:

ES-mini 240 min chart

Note that if we get a drop down to 5,800 in ES-mini, that drop would complete a flat (a) down, (b) up, (c) down corrective structure, a solid foundation for another leg up.

So micro wise, as long as bears hold ES-mini under 6,000 we can expect bears to finish the job they failed to complete last week, I mean testing 5,800 support level.

However, if bulls manage to break over 6,000 – 6,025 that would most likely mean a new leg up has started.



Subscribe to Free Updates

Get Unlimited Access

More To Explore

Important Disclaimer

CastAway Trader LLC, the publisher of this web-site and videos is not registered as an investment adviser nor a broker/dealer with either the U. S. Securities & Exchange Commission or any state securities regulatory authority. Users of the website www.castawaytrader.com and viewers of the videos are advised that all information presented on the website is solely for informational purposes, is not intended to be used as a personalized investment recommendation, and is not attuned to any specific portfolio or to any user’s particular investment needs or objectives.

Trading stocks, options, or futures carries a high level of risk, and may not be suitable for all investors. Before deciding to trade, you should carefully consider your objectives, financial situation, needs and level of experience. CastAway Trader LLC provides general overview of trading methods that does not take into account your objectives, financial situation or needs. The content of this website must not be construed as personal advice. All trading setups and/or trades presented in the web site and/or trading chat room by CastAway Trader an/or by other members of the chat should be considered hypothetical for educational purposes only and should not be expected to be replicated in a live trading account.

An investor could potentially lose all or more than the initial investment. You should not speculate with capital that you cannot afford to lose. Only risk capital should be used for trading and only those with sufficient risk capital should consider trading. Risk capital is money that can be lost without jeopardizing ones’ financial security or life style.

You should be aware of all the risks associated with trading. You should seek advice from an independent financial advisor.

Any information posted on this web site is not to be construed as an offer to sell or the solicitation of an offer to buy, nor is it to be construed as a recommendation to buy, hold or sell (short or otherwise) any security. All users of the website must determine for themselves what specific investments to make or not make and are urged to consult with their own independent financial advisors with respect to any investment decision. The reader bears responsibility for his/her own investment research and decisions, should seek the advice of a qualified securities professional before making any investment, and investigate and fully understand any and all risks before investing. All opinions, analyses and information posted on the website are based on sources believed to be reliable and written in good faith, but should be independently verified, and no representation or warranty of any kind, express or implied, is made, including but not limited to any representation or warranty concerning accuracy, completeness, correctness, timeliness or appropriateness. In addition, CastAwayTrader LLC and its officers and employees undertake no responsibility to notify such opinions, analyses or information or to keep such opinions, analyses or information current. Also be aware that the owners, officers and employees of the web site www.castawaytrader.com may have long or short positions in securities that may be discussed on the website, Premium Trading Chat room and/or in the videos posted by CastAway Trader LLC.

Past results are not indicative of future profits.

Subscribe to Free Updates

Get Unlimited Access