SPX overview for week 50 of 2022
Updated
SPX is in the final phase of the impulse. We have a great double top with a strong reversal and divergence.
There are two scenarios here.
First: Impulse completed. We are at the beginning of a deep correction.
Second: The formation of the 4th wave is underway. Dropping below 3890 will cancel this scenario.
In both cases, I consider a decrease of 3600-3800 to be probable. In the figure, I marked the levels where I will buy.
We have 2 open gaps. According to their location, I think that the correction will be deep right up to 3600 and maybe even lower.
If we follow the second scenario with sluggish growth, then I have doubts that we will be able to make a correction and go to the final growth before the recession. This means that we will not make a new high and go below 3500. If we go below 3500, then this is a sell-off and a recession.
If that final purchase I will have from 3500. This is a very strong level.
There are two scenarios here.
First: Impulse completed. We are at the beginning of a deep correction.
Second: The formation of the 4th wave is underway. Dropping below 3890 will cancel this scenario.
In both cases, I consider a decrease of 3600-3800 to be probable. In the figure, I marked the levels where I will buy.
We have 2 open gaps. According to their location, I think that the correction will be deep right up to 3600 and maybe even lower.
If we follow the second scenario with sluggish growth, then I have doubts that we will be able to make a correction and go to the final growth before the recession. This means that we will not make a new high and go below 3500. If we go below 3500, then this is a sell-off and a recession.
If that final purchase I will have from 3500. This is a very strong level.
Note
Scenario with wave C is mandatory now. So we probably finish wave 1 and in wave 2 correction now. It may be deep. 3700-3800 is the likely reversal zone for this correction. We also close one of the gap. Waiting for further development.
Related publications
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.