The biotech index gapped down and was stopped out at the open on Friday. Otherwise, Friday’s pullback has not had any impact on the major equity indexes.
The 30 min chart shows the two leading possibilities for the bullish count. The green count is that minor wave 1 has topped and minute wave [a] of 2 bottomed on Friday. The green count is looking for a [b] wave bounce, then another leg down to complete [c] around 2071. The blue count is that minor wave 3 is already underway and is ready to take off in minute wave [iii] to new highs. The third option not shown is the most bullish alternative that intermediate wave (1) just topped. This is the most bearish count for the immediate term as it would garner the deepest pullback, but would ultimately take the SPX to over 2500.
Looking at the NYMO chart, it would seem to favor either the green or third alternative count. The NYMO indicators have quite a bit of room before they become oversold and the lower barriers are quite a bit below the current level of the NYMO, all suggesting more downside ahead.
The daily chart shows the double top I’ve been expecting all along, consistent with either the blue or green counts shown on the 30 min chart. If the five waves up are merely intermediate wave (1), then this bull has legs.
