Years ago, we set our targets for the market to take us to 3000 and higher, and we are ever so close right now. But, the question with which we have been grappling over the last few weeks is what path the market is going to take to get us there.
Currently, I am tracking an immediate bullish path which will not likely break back below 2880/90SPX before we take off towards the 2980SPX region next. If this more immediate path is taken, then we can strike that 2980SPX region within the next couple of weeks.
Alternatively, the market can still drop back down towards the 2830-60SPX region before we begin the trek to the 3000 region. And, if the market chooses to take this path first, it will likely present us with a strong decline early in the coming week, as opposed to a gap up on Monday (which would maintain the more immediate bullish pattern).
In the upcoming week, 2895SPX is immediate support, with 2880SPX below that. As long as we hold that support, we are setting up for a more immediate rally to the 2980SPX region. Overhead resistance resides within our 5-minute market pivot of 2922-2930SPX. Should we gap up on Monday to complete wave 1, and as long as that resistance holds, then I am looking for a wave 2 pullback later in the week, as shown on my 5-minute chart. However, if the market is able to break out through our 5-minute market pivot, then we are likely heading directly to the 2980SPX region, and 2922SPX will become our new support floor.
Our longer-term expectations remain the same. As long as we hold over 2830SPX, I still want to see at least the 3011 region struck before we complete wave (5) of v of 3 off the 2009 lows, as you can see from the attached monthly chart. My ideal target still points towards the 3225 region, but we will need to see appropriate follow through over the coming month in order to be more certain we can attain that upper target.
But, I want to remind everyone again that we are in the very late innings for wave 3 off the 2009 lows, as I have been trying to warn for the last few weeks. While my preference is still for higher levels to be struck, a sustained break down below 2830SPX will be a strong warning that we may not make it to my ideal target. And, should we be able to move higher in the coming days and weeks, we will continually move that support higher (next level begin 2922), at least until we reach our upper targets. But, my expectation remains that once wave 3 completes, we will be starting a 20-30% correction, which can drop the market back down as deep as the 2100SPX region as we look forward to 2019 and 2020 (calendar years).