SP500 Analysis

3:30 p.m. New York time

Half an hour before the closing bell. The S&P 500 continued to rise during the day, to a high so far of 4413.25, surpassing last Friday’s high of 4408.25. Wave 4 of Minuscule degree continues its upward track.

9:40 a.m. New York time

What’s happening now? The S&P 500 E-mini futures declined when trading resumed over the weekend, reaching a low of 4375.50, nearly 33 points below Friday’s high of 4408.25. At the opening bell it resumed its rise.

What does it mean? My count views the Friday peak as the end of the middle leg within the uptrend that began July 21. The decline over the weekend was a correction, to be followed by a rise to new heights in the final leg of the uptrend.

What’s the alternative? It’s possible to view the Friday peak as the end of the final leg of the rise from July 21. If that’s the case, then it will be the end of the rise from July 19 and will be followed by a correction of the rise that began May 19.

[S&P 500 E-mini futures at 3:30 p.m., hourly bars, with volume]

What does Elliott wave theory say? Under my principle count, Friday’s peak ends wave 3 of Subminuscule degree within wave 5 of Minuscule degree, which began on July 21. Subminuscule wave 4 is now underway and will be followed by a rising wave 5 of Subminuscule degree. The completion of Subminuscule 5 will also mark the end of parent 5th of of Minuscule and Submicro degrees, and up one degree higher, the end of wave 3 of Micro degree, which began on May 19.

Under the alternative count, Friday’s peak ends wave 5 of Subminuscule degree and the parent degrees described above. The correction of the rise that began on May 19 under this scenario is now underway.

If the pride rises above 4408.25, then the principle analysis is correct.

See the chart in Friday’s post for a broader view, back to last March.

Learning and other resources. See the menu page Analytical Methods for a rundown on where to go for information on Elliott wave analysis.

By Tim Bovee, Portland, Oregon, July 26, 2021


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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