SPX stopped its ramp at 1886.06, nominally higher than Monday’s high at 1886.00. It may go higher, but for practical purposes, the rally may already be done.

USD/JPY also rallied this morning from its new lows, but could not overcome its prior high. It appears to be out of gas and its influence fading.

The 50-day Moving Average is at 1868.51. That may be used as a confirmation point for the decline. You can also see that the SPX used the lower trendline of its Broadening Wedge as support for the last phase of this rally. Its target is 1600.00. With the Ending Diagonal at 1266.00, the Orthodox Broadening Top, which is still untested, may drop out of the running, since the NDX is also in its final test of its Orthodox Broadening Top and may trigger its sell signal at the same time that SPX violates its Broadening Wedge for the last time.

NDX completed an Ending Diagonal Minor Wave C above the 50-day Moving Average, but may not hold it much longer. Once below the 50-day at 3602.56, we may see acceleration begin in the decline. At the same time, it will violate the lower trendline of its Orthodox Broadening Top and activate that formation.

VIX completed a triple zigzag formation that allowed it to extend it Master Cycle to 288.10 days, a month beyond the average Master Cycle. This explains the lack of a cohesive pattern as we have been continually frustrated with the lack of an impulsive reversal. This may finally be the reversal we have been looking for.

Regards,

Tony

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Disclaimer: The content in this article is written for educational and informational purposes only. There is no offer or recommendation to buy or sell any security and no information contained here should be interpreted or construed as investment advice. Do you own due diligence as the information in this article is the opinion of Anthony M. Cherniawski and subject to change without notice.

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