S&P 500 Elliott Wave: Retest all-time highs

Zorrays Junaid Alchemy Markets

Executive summary

Bullish Trend: SPX is retesting all-time highs at 6,151.
Key Support: 5,767 level is the support zone of a decline that may develop.
Wave Count: Still no sight of wave 4 decline.

Current Elliott Wave analysis

The SPX chart follows an incomplete Elliott Wave impulse pattern as the market climbs in wave (iii).

Back on May 15, while trading at $5,900, we forecasted a rally to retest the all-time high at $6,151. Now that we have arrived at $6,151, what is next?

It appears the market is still rallying in an extended 3rd wave labeled (iii).

The biggest clue to that assessment is that wave (ii) experienced a 7% decline back in April. Wave (iv) is a cousin wave to (ii), meaning they should have similar depths. It doesn’t have to be exact, but a 5-7% decline would suffice and offer evidence of wave (iv).

Until a decline of that amount appears, wave (iii) may continue to extend higher.

The current all-time high at $6,151 may create a bearish reaction. Don’t be surprised if a breakout above $6,151 creates FOMO and additional panic buying.

Bottom line

SPX remains in a strong bullish uptrend labeled wave (iii). The bullish pattern remains incomplete with the next decline, wave (iv) anticipated to remain soft at 5-7%.

Author

Zorrays Junaid

Alchemy Markets

Zorrays Junaid has extensive combined experience in the financial markets as a portfolio manager and trading coach. More recently, he is an Analyst with Alchemy Markets, and has contributed to DailyFX and Elliott Wave Forecast in the past.

EUR/USD holds steady above 1.1850 in quiet session

EUR/USD stays defensive but holds 1.1850 amid quiet markets in the European hours on Monday. The US Dollar is struggling for direction due to thin liquidity conditions as US markets are closed in observance of Presidents' Day holiday.

GBP/USD flat lines near 1.3650 ahead of UK and US data

GBP/USD kicks off a new week on a subdued note and oscillates in a narrow range near 1.3650 on Monday. The mixed fundamental backdrop warrants some caution for aggressive traders as the market focus now shifts to this week's important data releases from the UK and the US.

Gold corrects lower, tries to stabilize above $5,000

Gold started the week under bearish pressure and declined to the $4,960 area before staging a modest rebound. As trading volumes remain thin with the US financial markets remaining closed on Presidents' Day holiday, XAU/USD looks to stabilize above $5,000 ahead of this week's key data releases.

Bitcoin consolidates as on-chain data show mixed signals

Bitcoin price has consolidated between $65,700 and $72,000 over the past nine days, with no clear directional bias. US-listed spot ETFs recorded a $359.91 million weekly outflow, marking the fourth consecutive week of withdrawals.

The week ahead: Key inflation readings and why the AI trade could be overdone

It is likely to be a quiet start to the week, with US markets closed on Monday for Presidents Day. European markets are higher across the board and gold is clinging to the $5,000 level after the tamer than expected CPI report in the US reduced haven flows to precious metals.

Monero Price Forecast: XMR risks a drop below $300 under mounting bearish pressure

Monero (XMR) starts the week under pressure, recording a 4% decline at press time on Monday after a 7% drop the previous day, putting the $300 support zone in focus.