SPX500 terminates Wave 2 expanded flat around 4490

Written by EliasAndrei

October 19, 2021

SPX500 has rallied through 4490 mark at the time of writing, as expected and discussed earlier. The indice has carved a potential expanded flat corrective wave a-b-c, as labelled on the 4H chart here. There is still some room left towards 4500 mark but upside remains limited from here.

SPX500 had dropped from 4551 all-time high toward 4300 mark subdividing into five waves, marked as primary Wave 1 on the chart here. As a general guideline, an impulse drop is usually followed by a corrective rally.

SPX500 seems to have carved an expanded flat corrective structure (3-3-5) between 4300 and 4490-4500 levels. Also note that wave ‘b’ carved a new extreme around 4270, a typical guideline for expanded flat corrective structure.

Furthermore, SPX500 has rallied through the fibonacci 0.786 retracement of Wave 1 and high potential remains for a bearish reversal from here. If the above unfolds accordingly, the indice could be soon underway toward 4150 as Wave 3 progresses.

Alternatively, SPX500 might be carving Wave 2 an expanding triangle structure. If correct, the indice might drift sideways for a little longer before breaking below 4270 mark. Either way, the indice remains sell on rallies from here.

Prepared by

The Profinacademy.com Team

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