Bullish Move Not To Be Trusted Yet

Last night, I provided guidance for a potential rally today – which was seen - I also noted that I do not trust the bullish side of the market just yet:

“Does that mean I see this as a confident long trade at the moment?  The answer to that question is “no.”  While the action off today’s high was rather corrective looking, wave ii can continue to head lower to the 2075SPX region.”

With the market only providing us with a 3 wave rally today, it then dropped of the high in a 5 wave move.  When I saw the completion of the 5 wave move down, I issued this Wave Alert this afternoon:

As I said, I need this market to prove is bullish intent to me, and it still has not done so.  With the break down of the impulsive structure today, it has opened the door, yet again, to the bigger bearish count.  While the drop off the highs is nowhere near an ideal impulsive structure to the downside, I cannot ignore the potential for it to exist in ugly fashion when we see another 5 wave move down from a local high after a 3 wave rally, as we have seen today.

It is for this reason I am back in a 50/50 stance as to the next bigger directional move.  While I still think we will be heading down to the 2075SPX region into tomorrow (unless we extend today down to 2085SPX) - as long as we do not exceed today's high - the question will be if the market can break below the 2070SPX region to continue down in the more bearish impulsive red count.

For now, I think we will be seeing more downside this week, and the question now is, again, how strong and deep does this drop.  Clearly, a break down below 2064SPX would invalidate any bullish pattern I am reasonably seeing, and would have me targeting the 2000 region for wave iii in red.

I trust this market as far as I can throw it at this time (ie. . . I don't trust this market right now).  And, until I see another solid 5 wave structure to the upside, I am looking down.

So, as we move into the closing hour for the market today, as long as we maintain below today’s high, I will be looking down into tomorrow. We have multiple confluence with the 2106SPX region and the 2075SPX region.  This means that should the market maintain below 2106SPX on the current rally, I am expecting for us to decline towards the 2075SPX region. 

A break out over 2106.50 is the first indication that a decline may not be seen tomorrow. If the market is able move through 2106.50, and then take out today’s high, then I will have to much more strongly consider the bullish case to the 2150-75 region in a i-ii, (1)(2)(i)(ii) set up.