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"...Bulls Put on Notice"
http://www.pretzelcharts.com/
"In Monday's update, I wrote:
If it breaks down before then, then there are still options for that decline to be a C-wave, but we'll have to start watching things more carefully, because, as we know (and as illustrated on the NYA chart), we are likely into a larger fifth wave. And my old personal adage is, "Never bank on fifth waves." For now, we'll continue to presume there are still higher prices out there, but I did want to illustrate that it's not a great place for complacency.
The market is now in the process of attempting a breakdown, so we do need to start watching things more carefully. INDU is still three waves down, so it's not time for bulls to panic just yet, but the chart discusses some of the options in the event that the current decline goes on to become impulsive:"
" COMPQ moved a bit higher, then reversed:"
"SPX invalidated its proposed triangle, but I'll present a more detailed chart on Monday.
In conclusion, we've known for a while that we were in the ballpark that a fifth wave could complete, so while it would still be nice to see one more wave up, the likelihood of that wave may be more deeply called into question if this decline becomes impulsive. Trade safe."
"...... if this is indeed the triangle I speculated about in Monday's update, the last two sessions are what you'd expect to see."
http://www.pretzelcharts.com/
"The market was closed the past two sessions, at least in spirit. It went nowhere, though apparently it was open, technically speaking.
Accordingly, there's really not much to add, except to note that if this is indeed the triangle I speculated about in Monday's update, the last two sessions are what you'd expect to see."
"Do be aware that there's one wacky way to count this that would have the abcd all done on the triangle and just e remaining before a breakout. Lower probability but not impossible. Below 5800 would take that off the table.
In conclusion, there's no real reason to update any charts at all, given the last two sessions, but I updated the SPX chart anyway. Since nothing happened, there's nothing to add, and please refer back to the prior update for more details if needed. Trade safe."
"....we'll continue to presume there are still higher prices out there.........."
http://www.pretzelcharts.com/
"I'm going to mainly let the charts do the talking today. Let's start with COMPQ, which finally broke above its red resistance line. For a minute, anyway."
"Next is NYA, mainly to illustrate why things are getting a little more interesting now:"
"Next is INDU, whose near-term outlook is the same:"
"Finally, SPX, with one potential outlined:"
"In conclusion, in my perfect world, SPX would go on to form a triangle fourth wave here, launch out, hit its target, and reverse. If it breaks down before then, then there are still options for that decline to be a C-wave, but we'll have to start watching things more carefully, because, as we know (and as illustrated on the NYA chart), we are likely into a larger fifth wave. And my old personal adage is, "Never bank on fifth waves." For now, we'll continue to presume there are still higher prices out there, but I did want to illustrate that it's not a great place for complacency. Trade safe."
"........five up to new highs still to come.........."
http://www.pretzelcharts.com/
"Since last update, the market declined slightly, but still not a ton to add to the last few weeks of updates.
COMPQ dropped down to its support line, which has held so far:"
"INDU fell back through blue for the moment, but is holding the black channel:"
"In conclusion, as noted for weeks, there's probably still at least one more 4/5 unwind needed to new highs, so we may have just seen (or still be within) that fourth wave, with five up to new highs still to come. After that, things will start to get a little trickier again. Of course, if there are breakdowns before then, then either a deeper fourth wave is unfolding or something more bearish -- but we'll worry about that if it becomes necessary. Trade safe."
No SPX Chart Today but no real change either........
http://www.pretzelcharts.com/
"As those of you who own tape measures have no doubt noticed, the market has gone nowhere since Oct. 14, choosing instead to grind sideways. Which means there's still nothing to add, really. Which means:"
"So today will simply focus on a zone below the market and a zone above the market (2nd chart):"
"COMPQ's relevant zone is above the market:"
"That's it, those are the next two zones to watch, as they have been for the last couple weeks. Trade safe."
".....(In March) it appeared we might be in an extended fifth higher, whose textbook target was 6380-6450. And while that seemed kind of ludicrous at the time, SPX isn't so far off from those levels now."
http://www.pretzelcharts.com/
"The last few updates have talked about SPX likely still needing to unwind higher and blah blah blah but let's talk about something interesting today. Over the weekend, a reader requested I update the long-term SPX chart from March 11, and by golly, I thought that was a good idea.
On that chart, I had mentioned (in March) it appeared we might be in an extended fifth higher, whose textbook target was 6380-6450. And while that seemed kind of ludicrous at the time, SPX isn't so far off from those levels now."
"So what would happen if we were in that count? Well, we'd head higher into the election (as I mentioned several updates ago), maybe beyond, then we'd peak and head back to ~5120. Then we'd retest the high. Then we'd drop like a rock to ~3810.
So that would be interesting and fun. But let's see how things go in the meantime, as COMPQ is still a little bit of a thorn in bulls' paws:"
"In conclusion, not much to add to the near-term discussions from the past couple weeks, but it's probably a good time to return focus to the long-term count and keep an eye on how that develops. Trade safe."
"..this is bulls' first test since the breakout........." (Wednesday's Pretzel Update)
http://www.pretzelcharts.com/
"Last update noted that INDU had finally cleared its long-term rising resistance line, which is bullish as long as bulls are able to hold above that zone:"
"SPX could be in one of its presumed fourth waves, but if it overlaps the black horizontal KO, then that would be a warning sign for bulls:"
"Interestingly, the outlier chart is still an outlier, as COMPQ has so far failed to clear its prior high. Getting above that high would give bulls more breathing room, because below it (where we are now) still leaves open options for a much deeper decline, potentially comparable to the July/August decline:"
"In conclusion, this is bulls' first test since the breakout, and the zones to watch seem reasonably clear, so we'll see how they handle it. Trade safe."
"if COMPQ were to clear its prior high convincingly, then there could be weeks of upside still remaining -- so how it behaves here is of interest to both bulls and bears."
http://www.pretzelcharts.com/
"Last update suggested the decline SPX was experiencing was likely a 4th wave, and the new high since then has confirmed that. It probably needs at least one more 4/5 unwind:"
"COMPQ is still lagging. An interesting scenario would be if SPX managed to unwind another 4/5 while COMPQ still failed to make a new high. Something like that might put bulls at least on guard, were it to occur. On the flip side, if COMPQ were to clear its prior high convincingly, then there could be weeks of upside still remaining -- so how it behaves here is of interest to both bulls and bears."
"In conclusion, SPX performed as expected, so not much else new to add. Trade safe."
"......bulls probably have the ball for a bit, perhaps continuing into the election.............."
http://www.pretzelcharts.com/
"For the past few weeks, we've been watching INDU's long-term trend line and waiting for the market to announce its next intentions -- which it now seems to have done. Let's look at the charts and see what we've got now, starting with INDU itself:"
"SPX captured its next target, and its pattern suggests that there are probably some 4/5 unwinds needed, which could play out over the coming weeks:"
"COMPQ, on the other hand, is a bit of an outlier and -- so far -- hasn't played along with the breakouts in SPX and INDU"
"In conclusion, COMPQ is playing it close to the vest, but INDU has finally broken out above its long-term resistance zone, so as long as that holds, then bulls probably have the ball for a bit, perhaps continuing into the election or thereabouts. Trade safe."
"...bulls will need to keep pushing over this hump to keep the bull nest hopes alive...." Something tells me they are
http://www.pretzelcharts.com/
"Last update noted:
[I]n the event SPX can sustain a breakout over its ATH, then that would put some near-term bull options in play, including the option that everything since the "three down" low was a bull nest. For this to be the case, bulls would want to see a breakout on increasing momentum.
That looked to be the case early on Wednesday, but the rally has since stalled, so bulls will need to keep pushing over this hump to keep the bull nest hopes alive. The near-term SPX chart discusses the zone they need to hold and the next classic upside target:"
"INDU is one of the reasons things aren't a done deal for bulls yet, even over the near term INDU hasn't exceeded its prior high and is still at its major resistance zone:"
"Not much else to add beyond that. Trade safe."
Can SPX make a New All Time High?
http://www.pretzelcharts.com/
"Since last update, INDU has moved a bit higher within its noise zone:"
"SPX has made slightly better progress, now threatening to test its all time high:"
"The prior ATH is, of course, a resistance zone, but in the event SPX can sustain a breakout over its ATH, then that would put some near-term bull options in play, including the option that everything since the "three down" low was a bull nest. For this to be the case, bulls would want to see a breakout on increasing momentum. If SPX broke its prior high then stalled immediately, that would put options such as a larger expanded flat (which would be expected back below red, then back up to a new ATH), or an ending diagonal, in play.
Other than that, not much new to report since the last few updates. Trade safe."
"...SPX appears to be three waves down followed by three waves up............" Conclusion below
http://www.pretzelcharts.com/
"Friday's market didn't do anything to change anything, so... no change from the past few updates."
INDU first:
SPX:
"Of minor note, SPX appears to be three waves down followed by three waves up. As of this second, it hasn't overlapped the start of the prior wave down, so that means if it were to break the red line directly, there would be an option for it to be a nested bear wave. If it goes on to form another small 3-down, 3-up while the price range contracts, then we could be looking at a larger triangle continuation pattern. If it instead were to go on to make a new ATH directly, then neither of those are relevant. Not much else to add beyond that. Trade safe."
".........the market has basically just burned time going sideways, in an attempt to annoy everyone........."
http://www.pretzelcharts.com/
"It's been a long-standing tradition that whenever the update falls on October the 4th, I include the word "the" somewhere in the update, so I'll do my best to honor that tradition again today.
Since last update, the market has basically just burned time going sideways, in an attempt to annoy everyone. While this doesn't give us much information on its next move, it does give us a fairly clear support zone to work with heading forward:"
"INDU is in a similar position -- but to be fair, we'd already pretty much worked out that zone previously, plus a hair, this just tends to confirm it:"
"INDU's big picture chart still shows the zone for bulls to beat convincingly:"
"In conclusion, not much else to add beyond that. Trade safe.
The."
"....if bears can keep pushing lower and form a larger impulsive decline along the way, then that could bode for a larger top at the recent all-time high."
http://www.pretzelcharts.com/
"Last update observed that INDU appeared to have formed a micro impulse down and projected a decline to ~42K in INDU, which has since happened:"
"SPX declined as well and is in a similar position::="
"Long-term, INDU has so far whipsawed the breakout line:"
"In conclusion, if bears can keep pushing lower and form a larger impulsive decline along the way, then that could bode for a larger top at the recent all-time high. Of course, there's still work to do to get there, but this would be a nice place for it, since almost no one was expecting that possibility. We'll see how it plays. Trade safe."
".....bears should be extremely cautious for the moment."
http://www.pretzelcharts.com/
"Since last update, INDU finally broke above its major trend resistance, but it looks like it may whipsaw (I call both false breakouts and false breakdowns "whipsaws." I realize some people use different terms depending on direction, but I don't care.). Here's the short-term chart to explain why:"
"The tricky thing is that on the long-term chart, it appears INDU may still be above the breakout line, but the resolution on these very long-term charts always makes attempting to narrow things "down to the penny" a bit sketchy:"
"NYA's chart is a bit higher resolution and NYA does look like it's still above its line, so we'll see if that apparent micro impulse (in the first INDU chart) does its job:"
"Finally, SPX is just a mess of chop at all the relevant time frames, but if INDU's micro impulse down holds, then SPX will likely follow suit:"
"In conclusion, INDU appears that it may whipsaw its breakout -- but if it doesn't and instead goes on to run higher again, then bears should be extremely cautious for the moment. Trade safe."
"...SPX ran a bit beyond its upside target from a month ago, that target is not the end-all to the current inflection zone, so moving a little beyond it is of minimal significance."
http://www.pretzelcharts.com/
"Still not much to add. INDU is still backing and filling near its inflection zone. I like this chart in the current environment because it provides a clear visual reference for trend resistance. It's not unusual to see a market bounce along near a trend line (even bouncing higher) before reversing, so it provides a clearer visual guide to the inflection zone -- but it also gives fair warning to bear in the event INDU breaks and holds above that zone, as that would suggest a new burst of momentum higher."
"NYA is in a similar position, but the trend line shown on NYA's chart isn't as meaningful as INDU (due to it being a shorter time frame):"
"In conclusion, while SPX ran a bit beyond its upside target from a month ago, that target is not the end-all to the current inflection zone, so moving a little beyond it is of minimal significance. INDU is probably a better guide at the moment, due to its rising trend line better capturing the dynamics. Trade safe."
".....some back and forth here is perfectly possible, whether the market is trying to start topping yet or not."
"......this serves as the 8,347th reminder for "why I like to await an impulsive decline before getting too bearish.""
http://www.pretzelcharts.com/
"Nothing to add to the past couple updates, except to note that SPX made a new high, confirming the read that it had only formed three waves down and that north of the blue line would be trouble for bears. I can't find the live chart to update, so I'll just reprint that chart briefly. More than anything, this serves as the 8,347th reminder for "why I like to await an impulsive decline before getting too bearish.""
"SPX is still hovering near its first inflection zone:"
As is INDU:
"So not much to add here, other than to note that some back and forth here is perfectly possible, whether the market is trying to start topping yet or not. Trade safe."
".....some back and forth here is perfectly possible, whether the market is trying to start topping yet or not."
"......this serves as the 8,347th reminder for "why I like to await an impulsive decline before getting too bearish.""
http://www.pretzelcharts.com/
"Nothing to add to the past couple updates, except to note that SPX made a new high, confirming the read that it had only formed three waves down and that north of the blue line would be trouble for bears. I can't find the live chart to update, so I'll just reprint that chart briefly. More than anything, this serves as the 8,347th reminder for "why I like to await an impulsive decline before getting too bearish.""
"SPX is still hovering near its first inflection zone:"
As is INDU:
"So not much to add here, other than to note that some back and forth here is perfectly possible, whether the market is trying to start topping yet or not. Trade safe."
"...........while the market has reacted to its upside inflection zone, nothing even vaguely conclusive has yet happened......"
http://www.pretzelcharts.com/
"Following up on the prior update, the market has reacted to its inflection zone, but has not yet formed an impulsive decline, which means (as of this exact moment, anyway) bulls could still recover and make another run into the inflection zone. The near-term levels are fairly clear, at least in terms of the high probability reads (there are always weird outliers where, for example, SPX could break above blue and then collapse, those are just lower probability)."
"INDU probably remains the clearest chart at the larger time frames:"
"In conclusion, while the market has reacted to its upside inflection zone, nothing even vaguely conclusive has yet happened, so there's not much else to add. Trade safe."
".....the market has reached resistance......"
http://www.pretzelcharts.com/
"So the Fed went ahead and cut rates by 50 basis points. As mentioned last update, the last two times they did this after a hike cycle were 2008 and 2001, and we all know what happened after that, so this is not particularly encouraging for bulls. We're left to conclude that the Fed thinks the economy is slowing way too fast (potentially already in a recession) and that they need to play serious catch-up. I've heard another theory floated that they cut 50 bps because the election is coming, but that can't be it, because we all know the Fed is a completely independent and politically neutral part... (goes into fit of coughing).
Pardon me, I forgot what we were talking about. So let's get right into the charts! Starting with SPX, which captured its August target:"
"INDU also captured its trendline target:"
"In conclusion, the market has reached resistance and an inflection zone. This doesn't preclude further sideways-up action, but bulls will need to power through this level convincingly to generate new momentum to achieve anything beyond that. Things could reverse from this zone. Trade safe."
"The next President will inherit a recession."
http://www.pretzelcharts.com/
"SPX and INDU finally made new all-time highs, so let's get right into the charts to examine the implications, starting with the near-term INDU chart:"
"INDU's long-term chart shows overhead resistance not far away:"
"SPX seems to have squeaked out a new high, which is all it needed, but ideally it would look better if it could run up into the target zone from August 19 (which, incidentally, would probably line up pretty well with INDU's overhead trend line):"
"And of course, today is a Fed Day. Or a "Fedday" if you hate the Fed. Bulls are hoping for a 50 bps cut, but Lord only know why. 50 bps cuts for the first cut after a rate hike cycle are not typically bullish -- at least, not over the next 4 years, anyway. (This is because the larger cut implies the Fed realizes it overshot and is now rushing to catch up to the looming recession.)"
Incidentally, I'm going to call it now, so there's no question later: The next President will inherit a recession.
"In conclusion, the double "only three down so far" calls (from early August and then again for the last smaller decline) have both proved out. Bigger picture, the market is getting into a major inflection zone, so let's see how it reacts. Trade safe."
Market waiting on the FED decision Wednesday it seems
http://www.pretzelcharts.com/
"Well, most of us made it past Friday the 13th without getting attacked by men in hockey masks, though it seems former President Trump had another close call. Considering that prior to July 13, America hadn't seen an assassination attempt on a President or former President for 43 years, it's pretty noteworthy that there have been two attempts on Trump in as many months. Let's hope people calm down.
The market has run back up to its prior resistance zone:"
"INDU is in a similar spot:"
"Not much else to add to recent updates. We'll see if bears offer any pushback here or not. Trade safe."
Bulls do not have a lot to look forward to?
http://www.pretzelcharts.com/
"As the title implies, today is... Friday the 18th? According to the predictive text function:"
"So never mind. That wasn't what I was going to say, but I always believe predictive text, so I guess it was a false alarm anyway. Whew, that was a close one! But this means we're free to get right into the charts!
First up is COMPQ, which held its key trend line and bounced, so nothing new to add:"
"Next is INDU, which captured its 2nd downside target zone and bounced:"
"Finally, SPX, which held its key level and bounced, then captured (and since exceeded) both its upside targets."
"Hopefully all those levels and targets were helpful to readers. Going forward, as we can see, there are two viable counts in SPX (for now) and they're diametrically opposed -- which means it may be best to watch the next key levels (blue 3 on the upside, ~5483 on the downside). We can also see that if bulls exceed the prior all-time high, that doesn't necessarily mean a lot for them, because that could well complete blue 5 and end up going nowhere. Bulls would need to hope for an extended fifth to keep things running (over the near-term, anyway) after a new ATH. Trade safe."
9/11 Update 23 years and counting......
http://www.pretzelcharts.com/
"No real change from last update, but I have sketched-up some potential near-term upside targets for SPX:"
"COMPQ probably still best illustrates the zone bulls need to continue holding:"
"Not much else to add. Over the years, I've commented a number of times when the update falls on September 11, to the point that I feel like anything I try to add here today would feel contrived and trite, so I won't add any commentary beyond what I've already written in the past -- but I likewise did not want the day to pass without any acknowledgement. Trade safe."
"......"I'd probably lean toward saying it looks slightly more likely that it may need more downside to form any sort of complete wave." And that turned out to be a hit....."
http://www.pretzelcharts.com/
"In the prior update, a hypothetical guy with a gun forced me to give a prediction, so my reply was: "I'd probably lean toward saying it looks slightly more likely that it may need more downside to form any sort of complete wave."
And that turned out to be a hit. Now we have two markets trying to make our lives difficult, so let's get right to it. First is INDU:"
"Dueling with INDU is SPX:"
"And the tie-breaker may be COMPQ, and what it does with the blue trend line:"
"In conclusion, INDU appears to be 3-waves down SO FAR, while SPX might be 5-waves down, though the razor-thin margin of the prior high vs. the ATH means it might also be 3-down so far. Some part of me wants to just flat out declare the bull market as over -- but another part of me wants to caveat that heavily because there is no technical confirmation of that yet, and it's entirely possible we've only just entered the topping "process," which could take months. And I'd also note that we're in the ballpark of a downside inflection point, given that INDU and SPX could both be completed waves to the downside (plus/minus) and COMPQ just tagged a major support zone -- so if it's going to head back up, it could do so from here. COMPQ may provide the next big picture clues. Trade safe."
"............ if I had a gun to my head and had to say something, I'd probably lean toward saying it looks slightly more likely that it may need more downside to form any sort of complete wave...."
http://www.pretzelcharts.com/
"Since last update, SPX rallied back into the zone of the blue resistance line and was rejected. After that, it went on to form something that's best described as opaque garbage. The annotation below explains the conundrum:"
"INDU briefly broke its support line, but looks like it's going to whipsaw that directly:"
"In conclusion, there's not a lot of clarity in these charts, but if I had a gun to my head and had to say something, I'd probably lean toward saying it looks slightly more likely that it may need more downside to form any sort of complete wave. But that's really only because some hypothetical person is holding a gun to my head. If I hadn't invented that person, I might not say anything other than "wait and see," so don't hold me to it, I'm under hypothetical duress here! Have a great weekend and trade safe."
"..........things aren't locked down for bears just yet. SPX is only three waves down (at present) and INDU has only retested its prior breakout, which has held (again: so far)....."
http://www.pretzelcharts.com/
"Last update noted that we were getting into an inflection zone, and on Tuesday, the market put an exclamation point on that.
Let's look at the charts to see if bears can continue celebrating, or if they need to tread cautiously for the near-term, starting with INDU:"
"Next up is SPX:"
"So, as we can see on the near-term charts, things aren't locked down for bears just yet. SPX is only three waves down (at present) and INDU has only retested its prior breakout, which has held (again: so far). Since we can only trade what we see, what we see is a market that's been rejected at a potentially major inflection zone, but has yet to indicate whether it's going to make another run back up into that zone.
Bigger picture, we see the nature of the current inflection zone clearly -- but we need to keep in mind that big inflection zones have big ranges, too, so there's plenty of room for INDU to run up to new highs again and still be within the inflection zone."
"In conclusion, bear had a fun day yesterday, but they haven't yet proven they're ready to take over (since they've only formed three waves down so far) and thus we can't yet rule out another run up. We'll see how things develop for the remainder of the week. Trade safe."
"......as the market appears to finally be approaching an inflection point that has significant and real MAJOR top potential:..."
http://www.pretzelcharts.com/
"Last update projected that INDU would need at least one more fourth wave correction, followed by another wave up to new all-time highs, and that has since happened:"
"As the chart notes, it's getting trickier now, which stinks because I won't be able to devote as much time to goofy jokes, since the market will become less predictable and there will now be fewer updates that say "no real change" and that allow me to reprint the same charts but with smiley-face stickers on them.
It's also getting tricky at long-term scale now, as the market appears to finally be approaching an inflection point that has significant and real MAJOR top potential:"
"In conclusion, the odds probably slightly favor one more 4/5 unwind still left, but I wouldn't bet the farm on that, especially since we're getting into the ballpark of a MAJOR (yes, I'm capitalizing it again) inflection zone. Don't forget Monday is Labor Day, so the market is closed because it's disruptive to have traders going into labor right in the middle of the exchange floor. Trade safe."
"We should finally get a decent correction again once those waves complete."
http://www.pretzelcharts.com/
"Since last update, INDU made a new all-time high, as expected:"
"This SPX chart is a wonder to behold:"
"In conclusion, presuming we're dealing with a simple impulsive rally off the August lows, SPX and other indices should need roughly the same 4/5 unwinds that INDU needs, so that chart serves as a reasonable proxy for the broad market right now. We should finally get a decent correction again once those waves complete. Trade safe."
"...SPX and INDU will need at least one or two more 4/5 unwinds higher before completing the wave up from the 3/c low."
http://www.pretzelcharts.com/
"On Friday, Powell wandered out to the microphone from the dark underground depths of Jackson Hole, appearing drunk, grabbed the mic forcefully and muttered something about, "too many lost socks," before passing out, still holding the microphone and drooling.
The market wasn't sure what to make of this, so it traded sideways for the day.
Which means, you guessed it, nothing has really changed from the updates of the past few weeks. Although, INDU has now made a new high to match NYA:"
"SPX appears poised to resolve its previously-discussed probable fourth wave to the upside (which is/was the expected outcome of a fourth wave down, of course)"
"In conclusion, not much else to add other than -- assuming we're in a simple straightforward impulse rally -- a reminder it still looks like SPX and INDU will need at least one or two more 4/5 unwinds higher before completing the wave up from the 3/c low."
Pretzel :
(1) Pretzel presents both a Bull and Bear case.
(2) Pretzel gives both Triggers and Targets
AI
