Flirting with disaster. Wave 3 of 5 down is in progress and why the market is not just falling off a cliff is confusing. All the elements were there chartwise and with the economy. How 3 plays out is anyones guess. We need to get lower for 3 to be longer than 1 (although that is not required). We reaced my first target of 780, but most are looking for something in the 735 to 750 range. Looking at the VIX the daily confirms further move south, but the 60m appears to want to turn up. This will cause another pennant on the way down and screw up a bunch of EWT counts.
Bearish case on the 60m chart above there is a possible bullish MACD cross, STO is about to give a bull cross witht the 10 ema, RSI is traveling along the 30/bottoming line, there is an enormous gap above and the market has sold off more than 10% since 2/9. The bear case is that everything globally sucks, the stimulus plan is a dud, housing market is not going to get fixed anytime soon, banks are possibly getting nationalized and on the TA side the sym triangle is ending in a pattern that should send it south and while traveling down a channel line beating on it repeatedly it will eventually give away.
My call - I am going against the tend. We may fall to the 750 level, but we'll rebound. With OpEx Friday the market may try to save SPX's max pain at 850. This has not been reliable over the past several months. The 60m charts look oversold and the market needs to let off some pressure. To me the volume is not there to take the market significantly lower, and I also believe that it will take some external stimulus to get the capitulation selling some are calling for. Any move up will be brief and will stop belos 875 SPX and really should not exceed 850 if it even gets there.
Good luck today.