How Extended Can We Get?

To be honest, the micro-structure has been causing me some issues in the SPX.   So, I decided to just go to a very simplistic Fibonacci Pinball structure, which is now the count on the 5-minute SPX chart.

The crux of this count suggests that we are topping in wave 3 of iii of [iii], and can pullback towards our pivot on the 5-minute chart.  But, in order to confirm this, we will need to break down below 3825SPX.  For if we remain over that micro support, it can point us to a more extended 3rd wave structure which I was presenting earlier today on my 5-minute chart.   It would point up to the 3885-3900 region as our wave 3 of iii target.

Also, take note that the 3885-4000 region is our next congestion/resistance region overhead on the 60-minute chart, and is also the region where the downtrend line resides.  That downtrend line takes into account the higher level for the b-wave which was struck in the futures.

So, in very simple terms, I am still bullish over the coming week or so.   Our next resistance overhead it actually the 1.236 extension on the 5-minute chart in the 3875SPX region up to the 3900PX region, as noted from the 60-minute chart.  Our support is the pivot on the 5 minute chart.  As long as we hold the pivot as support, I am looking up to the 3900SPX region next.  The only question is if it will be wave 3, or wave 5 of iii.

I think we need at least one more push higher before we even really have to be worried about the red count potential.  But, once we move up towards 3900, it will then be something that MUST remain on our radar.  That will be the next major test for the bulls.

Avi Gilburt is founder of