SP500 Analysis

3:30 p.m. New York time

Half the hour before the closing bell. The S&P 500 moved above the 23.6% Fibonacci retracement level during today’s trading session. The present rise, wave B of Submicro degree, can be expected to retrace 90% or more of the preceding wave A, which gives an upside target of at least 4523.93. After the B wave peaks, a C wave will carry the price down to the low 4300s or a bit below, completing the corrective pattern within wave 4 of Micro degree.

9:40 a.m. New York time

What’s happening now? The S&P 500 E-mini futures continued to rise in overnight trading.

What does it mean? The rise is, possibly, the final leg of a smaller upward correction that began on September 20, within the middle leg of a larger downward correction that began on September 3. The correction could extend in a compound pattern — two corrective patterns in a row.

What’s the alternative? It’s possible that the smaller upward correction is one level smaller than my labelling would indicate, meaning that the correction has further to go that I thought.

[S&P 500 E-mini futures at 3:30 p.m., 50-minute bars, with volume]

What does Elliott wave theory say? The analysis is unchanged from yesterday’s post: A rising wave B of a Submicro degree correction within a declining wave 4 of Micro degree correction. Submicro wave A fell from its September 3 starting point down to a Fibonacci retracement level of 50% of the preceding wave 3 rise. Submicro wave B has risen to just below the 23.6% retracement level.

Learning and other resources. Elliott wave analysis provides context, not prophecy. As the 20th century semanticist Alfred Korzybski put it in his book Science and Sanity (1933), “The map is not the territory … The only usefulness of a map depends on similarity of structure between the empirical world and the map.” And I would add, we can judge that similarity of structure only after the fact.

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

By Tim Bovee, Portland, Oregon, September 23, 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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