A normal retrace of the advance from the low yesterday overnight accelerated this morning on the PCE numbers such as to force a new low in the late morning. I had been expecting a retrace in a [B] wave and could still be one as ‘b’ waves can make a new price extreme. We did get a nice bounce out of support from [B] wave supports but will have to see if bulls can hold a higher low this afternoon. The alternative is that the low today is a wave (III) and the bounce a wave (IV) which implies a new low later today for a (V). As I type, the support range for [B] is being retested.
Notice how YM is testing the ledge and started to back off. I’m fearful if they fail to hold here that there will be an acceleration lower.
Taking a peek at the percentage of S&P components under the 20 day moving average, we can see that we are up at the top of the range. It certainly can become pinned up here but prefer a bit of a retrace first.
Appreciate your analysis at this moment (huge volatility and incertainty).
See what ll happen.