Market Update

Avi Gilburt

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Following downside setup Mon Mar 19th 2018

The market dropped strongly lower today, following expectations for further downside after the 50 day SMA was breached overnight by futures. Based on this downside follow through, the high made last week counts best as either the (b)-wave of an expanded flat shown in red, or the circle b-wave of a corrective wxy off the February bottom shown in blue. The red count assumes a bottom already in place for the minor degree wave 4 at the February low, with wave i of 5 complete at the Feb.

SPX Micro Count Points to Corrective Wave 2 Rally Thu Mar 15th 2018

I am sure a number of you were confused by the potentials I placed before you last night.  While I endeavor to make the market easier for those that follow our analysis, there are times the market does not provide us with the clarity we need to identify the greater probability set ups.  And, yesterday was one of those times, especially when the market broke the immediate impulsive structure we were following. With today’s action, I am starting to lean a bit more in one specific direction.

The Market Just Got Infinitely More Complex Wed Mar 14th 2018

Today, we broke down below the immediate support which kept pressure strongly to the upside, and opened the door to several possibilities in the market, for which I still need more information before I can quantify the probabilities. I want to first prepare you that you will have analyze each potential I am outlining below, so please take your time with this update so you understand the implications of the additional complexity with which we are now faced.

Bull’s Big Test Tue Mar 13th 2018

On Monday, the bears had an immediate downside set up fall out of their hands, which caused them to fumble the ball.  The bulls picked up the ball, and ran it up to the 1.236 extension today, and have now pulled back into the support region noted on our charts.  Will the bulls hold onto the ball? You see, if both the bears and the bulls are unable to hold onto the ball, it suggests that we are still in an ongoing whipsaw/corrective pattern.

Personal Preference vs. Price Action Mon Mar 12th 2018

We all struggle with the financial markets, as they seem to surprise so many and make sense to very few.  So, rather than maintain “beliefs” about what we think we know, I have always fallen back upon price action to provide for me the truth in the market. When we began this pullback a little over a month ago, we set a target for this wave (4) between 2424-2539SPX.  And, in February, we struck a low around 2533SPX.

Bulls Refuse To Give In Thu Mar 8th 2018

With the move up late yesterday, the bulls made it clear that they are not ready to throw in the towel.  With the move through this week’s high, we have still maintained both potentials we have been tracking of late, with my primary still being that wave (4) has not yet completed.  But, we no longer have an immediate set up pointing lower.  We would need another smaller degree 1-2 downside set up to suggest that.

Mixed Messages - But Potential Downside Set Up In Place Wed Mar 7th 2018

Sometimes it is nigh impossible to have a strong bias about the next imminent step the market is going to take.  This applies almost exclusively within corrective market action.  My expectation coming into this week was for a rally which would have us top out and begin a bigger decline phase.  While we got a beautiful long set up when we came into the office on Monday, and caught over 50 points in that rally, since then, the market has become increasingly difficult.

Market Is Toying With Us Tue Mar 6th 2018

While the market gave us a really nice 50 point trade set up off yesterday’s lows, it certainly turned a bit more frustrating with today’s action. Early this morning, I posted an updated noting that “it would likely mean we see a top and reversal today, to be followed by the important test of support.”  So, right after the open, we began to drop right down to the support noted on our chart.  But, the drop was amorphous enough in its pattern to leave all options still on the table.

Bull/Bear Lines Have Now Been Drawn Mon Mar 5th 2018

While we came into this week with the expectation for a bounce in the market, we may be seeing a bit more than just a simple bounce. You see, while the move off the lows on Friday was very overlapping, it actually counts quite well as a leading diagonal.  And, despite my aversion to leading diagonals as trading cues, this is actually one of the better ones I have seen from a structure standpoint. What this means is that the market MAY be attempting to complete 5 waves up off Friday’s low.

Bears getting the job done Thu Mar 1st 2018

The market followed expectations for further downside today, even exceeding standard targets based on the micro count. Therefore, it is possible that this wave c of 4 down off the high earlier this week is developing in a more accelerated fashion, which I've shown on the chart in blue. Under that path, we have an initial (i)-(ii) i-ii off the high already, and price is already in the heart of wave (iii) with further immediate downside coming tomorrow.