Live: Monday, April 27, 2020

(Corrected the title day to Monday instead of Tuesday.)

10:55 a.m. New York time

What’s happening now? Stocks continue their rise that began April 23, reaching 2865 on the S&P 500 before swing into a very low level sideways move. The price at today’s high is within 20 points of its peak since the downward movement from February resumed on on April 16.

What does it mean? The market continues its correction within a larger downtrend. A movement above 2885 would change that assessment.

What does Elliott wave theory say? The present rise is a 2nd wave of Minor degree. It had appeared last week that the 2nd wave was complete, but such proved not to be the case. If today’s sideways movement flips into further decline, then Minor wave 3 will have begun. This small-scale drama is happening within Intermediate Wave 1 of Primary wave 3, both downtrending.

Screen Shot 2020-04-27 at 7.53.08 AM

What is the alternative? If the price moves above 2885, then Primary wave 2, which by my preferred count ended April 16, is fact not yet over but instead is adding another zigzag or perhaps a flat to its journey. Ultimately, Primary wave 3 will begin. The question is when.

What about my trades? Holding. If Primary wave 3 is underway, then my three short bear call options spread positions on SPY will be profitable. If Primary 2 still has work to do, then the positions will be unprofitable. The entry analyse for the positions are linked to the lot numbers: Lots 12, 13 and 14, all expiring May 15.

Terminology. Here are some links to information about some of the technical jargon I use.

On the charts, waves have a subscript showing the degree above or below the Intermediate degree. Here are the subscripts and the degree each represents:

  • {+3} Supercycle
  • {+2} Cycle
  • {+1} Primary
  • No subscript: Intermediate
  • {-1} Minor
  • {-2} Minute
  • {-3} Minuette

By Tim Bovee, Portland, Oregon, April 27, 2020


Tim Bovee, Private Trader tracks the analysis and trades of a private trader for his own accounts. Nothing in this blog constitutes a recommendation to buy or sell stocks, options or any other financial instrument. The only purpose of this blog is to provide education and entertainment.

No trader is ever 100 percent successful in his or her trades. Trading in the stock and option markets is risky and uncertain. Each trader must make trading decisions for his or her own account, and take responsibility for the consequences.

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