SPX has overlapped Wave [i], greatly diminishing the probability of another probe to a new high. This strongly suggests that the Top is in. This is turning into a complex decline that still may have a risk of a final surge to 2122.00, but no higher.

Take the appropriate action you deem necessary, given your propensity for risk. Shorting a bounce above 2200.00 may lower the drawdown due to a possible incomplete Wave formation.

VIX has rallied above its prior high at 13.55, but has not yet surpassed its 50-day Moving Average at 14.75.

Any action taken on this signal would be considered aggressive. A move above the 50-day would give some additional comfort.

The Hi-Lo has not come down appreciably from its Cycle Top at 288.55. We should look for a close beneath mid-Cycle support at 116.55 to have some confirmation of a change in trend.

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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