FOR WEDNESDAY: (12/14) Another FOMC day. This one is a done deal but will we get a lot of sell-the-fact and buy-the-fact energy? Probably. So many patterns seem temporarily complete. In the end we don’t like these days because they’re still a bit too much of a meat grinder from the computer ALGOS.
MARCH E-MINI S & P 500
S&P ANALYSIS FOR WEDNESDAY (12/14) Market completed the slight new high to 2273 and that sets up the pullback to 2240 now and not clear how long it will take. In the end, we can’t buy for 2295-2300 without a pullback to 2340 or 2330. Will the trade sell the fact and not be happy with forward guidance? Patterns suggest a pullback and then two new highs to 2300 and 2330 before we really have to worry about a 100-point pullback.
OVERALL: Five waves up from the 2179. Italy vote is complete and a 34-point pullback would have to hold 2130 on March futures. That still would require a new high by Dec. 22 toward 2296 with additional resistance at 2330. It would seem that 5-wave up from the election low would be complete at 2330 and set up larger fall. For now we can still buy pullbacks to 2230 and day trade shorts from key levels. Not sure the Electoral College nonsense means a lot.
WEEKLY CHART: (12/12) Eventually we might get a 110-point correction from 2330 to 2220 and could take a few months which we need to confirm in the cycles. That means that much of the fun of the current rally will be over soon. Daily cash charts starting to project 2300 and weekly charts 2335. We have a bias for higher prices from FOMC into Dec. 22 but we’re not clear how long it will take to do the last push up to 2330. Could be as late as Jan. 7.
MONTHLY CHART PATTERNS: : 2420 isn’t out of the question before this bull market ends and it takes a long time to turn an ocean liner around in so V-tops and crashes are not to be looked for and publications that steer you that direction are being too sensational.