Five Waves Appear to Have Formed From the Top

The S&P blasted right through 1145, and did so with a 5 wave impulsive decline from the highs. Internals are extremely bearish right now as basically only seller are in the market. The bears are in firm control. Obviously, the start of that 5 wave decline at 1174 is key to the short term bearish case. So risk can be placed above there for short term bearish trades in my opinion. With 5 waves down from the high it suggests that the larger trend is now down and that we have AT LEAST another down leg after a relief rally. The S&P's low on the day is 1128, so that also eliminates the bullish count I have been tracking the past couple days as well. So two key levels were broken through in just the first couple hours of trading. So today's decline has been productive for the bears. 1110.88 is the next key level for the bears to obtain, and a break below 1100 would all but confirm that a major down-phase is underway.

Just as a side note, for those interested I placed this morning's CNBC interview with Prechter below.






PLEASE NOTE: THIS IS JUST AN ANALYSIS BLOG AND IN NO WAY GUARANTEES OR IMPLIES ANY PROFIT OR GAIN. THE DATA HERE IS MERELY AN EXPRESSED OPINION. TRADE AT YOUR OWN RISK.