In an effort to prepare for what is to come, the road map since the beginning of the year had the S&P 500 falling about 6%, followed by a very high retracement, and as the equity markets took a step back yesterday, the edge goes to the bulls for fresh highs if the SPX takes on a small constructive consolidation. Deeper losses, testing the old lows at SPX 1737, but not breaking it, would likely evolve into a protracted indecision period. Whatever turn the markets make, following the path of TD Sequential is helpful as guide to trend continuity and the potential end.
S&P 500 (SPX) SHORT TERM OUTLOOK: NEUTRAL
Change to bearish if SPX closes below 1829.83, the daily price flip.
If the current TD Buy Setup on the 2 hour SPX can remain uninterrupted and plow under the short duration TDST Support clusters between 1809.22 and 1813.44, that will provide the first step that a deeper retracement is more probable than not.
S&P 500 (SPX) SHORT/INTERMEDIATE TERM OUTLOOK: NEUTRAL
Switch to bearish with a close below SPX 1829.83.
The SPX daily has one more chance to complete a full TD Sell Setup if it can close above 1829.83. However, it would not any difference since the high of yesterday’s bar 8 has already done the dirty work of perfecting the Setup and the SPX now has the green light to head lower.
S&P 500 (SPX) INTERMEDIATE/LONG TERM OUTLOOK: BEARISH
Switch to neutral if SPX weekly cannot record a close below 1790.29 (updated February 17th)
S&P 500 (SPX) LONG TERM OUTLOOK: BULLISH
Flip to neutral if SPX (monthly) closes below 1756.54 (updated February 3rd.)