Based upon the overnight action, the market has come within points of the yellow wave iii. Therefore, I am forced to switch gears and primarily follow the yellow count, which is pointing down into the low 3900 region.
Again, there are just so many things I do not like about this pattern, but if price is following it, I have no choice to do so as well. Therefore, 4081SPX is now our main resistance on bounces. Should we bounce today, and maybe even into tomorrow, and do so correctively, then it would suggest that the pivot between 4063-4081SPX is going to be our resistance. Should this resistance hold, then we are pointing down to at least 3985SPX for next week.
Should the market begin to rally in the futures in a CLEARLY impulsive manner, and we break out through our pivot, I will likely go back into the bullish count.
I am not sure how many times I can repeat this, but I have not favored this potential yellow count for many reasons, and I do not trust it wholeheartedly. But, for now, I am forced to recognize that the bears have the ball until the bulls can make them fumble over our pivot.