Midday Update: 2023-09-13
Quick test of support after CPI
S&P 500 futures fell to just short of a support level I was looking to be tested from the chart I posted last night/very early this morning. At first, I assumed that was a wave (III) low and expected a choppy bounce for (IV). There was indeed a bounce but a bit stronger than I expected as it created a little overlap with what I originally thought of as wave (I). That wasn’t a deal breaker as that level corresponded to other resistance and the day session hourly 20 EMA at just after the day session open. There was indeed another push down from that area but the failure to follow through to a new low of the day caused me to reassess the pattern. Since a third wave and a ‘c’ wave are essentially identical in form, I started playing with the idea that the low of the day was a ‘b’ wave type low which led me to the following hypothesis.
Under 4521.25 may be an early warning that wave [II] is complete though the cautious may look for under 4515.50 as confirmation. It is interesting that Dow futures didn’t follow the S&P 500 futures to new post open high.
Taking a quick look at crude oil, we see it is starting to slip lower. Bears need CL under 88.20 to have something to work with and under 85.15 to really feel good about a reversal.
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