Yesterday’s count expected further upside, which is what the market provided. At this stage, there’s just not much to add. This remains one of the more challenging structures I’ve had to decipher in some time, but if the expanded flat interpretation is correct, the market should find a top in the near future. If the alternate bullish count is correct, then the SPX is probably on its way to 1460-1470. There’s been little to add confidence to either direction.
Viewed with a more traditional technical analysis eye, the market appears to be breaking out from a trading range/base, which would be considered bullish. Of course, if the market does whipsaw back into that range, then it would not be a surprise to see it drop rapidly, as oft-traded ranges offer little in the way of support or resistance, except at the edges of the range.
The very short-term structure is extremely difficult to decipher, and the rally may be complete or nearly so, or may have another down/up left in it. Watch for a bounce off the top of the old trading range.
One of the reasons I remain in favor of the more bearish count is the COMPQ, which appears to have formed a clear 5-wave decline.
It’s worth keeping in mind that if this is indeed a larger second wave retracement rally, then bullish sentiment is to be expected. Second waves “want” to be bull markets.
In conclusion, there are no magic bullets that I can find at the moment. At this point, it’s up to Old Man Market to either prove or disprove the bear case. If the preferred count is correct, then there should be a reversal brewing soon. Trade safe.