Before moving on to the S&P 500, let us check in on crude oil. I know I have been wrong on trying to pick a high in CL, but nothing has happened to change my mind about this being primed for a retrace at a minimum. Today, CL has fell back under the 91.80 target and headed to the first support level at 90.55. Note that negative divergence has been building for several days. If CL breaks under 90.55, my bias is lower to at least test 88.70 and think there is a good chance to push for 86.85.
Back to the S&P 500, I was thinking we needed a bounce but I’m not certain how to treat the bounce and if there will be a new low following the bounce. As the day has progressed, I’m now leaning to treating the of the day as a completed impulse and now up into the first stage of a wave (II) bounce. The day session hourly 20 EMA looks to be important this afternoon. I suspect there are bears out there that are waiting to take a swing around that area.