I don’t know whether it is because of the -30 degree wind chill or some other problem, but a lot of things don’t work this morning, including my cable internet.

There is a new Head & Shoulders formation on the charts this morning that actually exceed my projections from yesterday. This also sets the tone for the decline, since Head & Shoulders necklines appear most at the bottom of a Wave 1 or A. If the completed decline is a Wave 1, the SPX has a good probability of going much further.

We see a similar pattern, including a down-sloping neckline of a Head & Shoulders formation. Again, the target is lower than I had projected yesterday. You can also see that NDX dropped through its 50-day moving average at 3508.13 and cannot rally back above it. We also see the hourly Cycle Bottom also crossing the same vicinity, creating a double resistance.

This may get even more exciting.

Regards,

Tony

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