Bounce In Progress - Market Analysis for Oct 13th, 2025
By
Avi Gilburt
After being so stretched to the downside in Friday’s decline, it was not hard to expect a bounce to develop early this week. But, the question with then be how the market pulls back from this bounce?
Well, thus far, the pullback has been corrective. And as I noted in the weekend update, until the market provides to us an indication that it will continue lower, we are forced to continue looking higher.
Another wrinkle in our charts is that the ES dropped a bit further than the SPX, which does cause a bit of complication. You see, the SPX can count as a 5-wave decline, whereas the ES really counts best as a 3-wave decline due to its after hours extension. I outlined this issue in the weekend update.
But, as you can see from the attached charts, it does make a bit of difference between the two paths and resistance regions.
For now, I think it is reasonable to expect the SPX to head higher at least towards the .764 retracement region. While the ES does have potential for more of a (b) wave pullback in the coming day or so, we do not see the same indication in the SPX. So, I am unsure as to whether we are going directly higher to the .764 retracement region or not right now.
Yet, the main point I am going to make for the coming week is we will have to see if the market provides to us a 5-wave decline at any point this week which can suggest that either a larger degree c-wave or 3rd wave down has begun, which will point us to our next support in the 6360SPX region or if the market is going to provide only corrective pullbacks, pointing us to our next higher Fib targets in the 6830SPX region as per the alternative yellow path.
As you can see, I have added the alternative, as I explained in the weekend update, since I do not see any impulsive declines taking shape yet. So, until we see a 5-wave decline, we are forced to look higher in a further 4-5.
In the micro structure, my preferred path would see a smaller c-wave decline complete the (b) wave in what I expect to be an (a)(b)(c) rally this week.
NOTE: Starting tonight into Wednesday night, we are celebrating the religious observance of the final two days of the Sukkot holiday, during which we are forbidden to work. So, Zac, Mike and I will be off the site during that time. Garrett and the other analysts will be filling in. But, PLEASE be respectful of their time as we will be short staffed for the next two days. Thank you.
