The SPX and most US indices has finally broke down! Cheers to all the people who had the patience to wait for this correction,before we hit new highs. Since momentum has changed to the downside, we now focus on our target downside for good entry points.
We have setup a few sets of support for this 40pts SPX drop.
1. First it broke down the uptrend lines, the 40pts drop confirmed that we broke down out of support, the target downside is 1550.
2. Elliot Wave length retracements (assuming we are in the intermediate iv correction of Major Wave 3,Primary III):
minor a was 89 pts long. target for minor c:
0.618a = 1598 low
1a = 1563
1.618a = 1511
3. Fibonacci retracements:
38.2% = 1550
50% = 1518
61.8% = 1472
4. Medium-Long term uptrend since Oct 2011 has MAX support of 1482.
Roughly, we can say that good entry points can be as early as 1563, with a main target of 1550, and we can say 50% Fibonacci retracement of 1518 (50% retracement) is the worst target for now. (61.8% is too deep)
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