The S&P ($SPX) Is Now At A Very Important Level

We have been discussing the .618 retrace from the all-time-highs to the recent pivot lows, and now that price near these levels, we are seeing some intense price action.

Fibonacci retraces are numbers that occur in nature (complex systems), and the $SPX is no different as it is made up of 500 companies, with millions of minds that work in those companies and millions more that trade their price action, so it makes sense that these levels are important to observe. When aligned with Elliott Wave, we can often find setups, once we get used to observing the price action.

Currently, the weekly chart is timid around these levels (a Doji forming at the time of writing), but we are seeing some interesting action on the lower time frames.

For instance, the daily chart has been putting in upper-shadows around these levels. 

If this is indeed the wave B triangle overshoot, then a sharp rejection could see more downside.

We will continue to observe these levels for signs that the larger wave C (which will likely start with a sharp down wave) is beginning.

Check out this video for more explanation:

Dr. John