EWP - SPX - The Impluse is Complete and Time for a Correction
As per my previous chart, we see a clear 5 wave impulsive wave that came to an end at 3230. Because the ABC correction to the 2200 lows were clearly an ABC correction, this indicates that the impluse wave up to 3200 is most likely Wave 1 of a new cycle.
With this in mind, Wave 2 can retrace all of Wave 1, so the maximum that it will fall will be 2200 for this to be valid. Typically, Wave 2 will retrace 50% - 78.6% of Wave 1, but remember that it can retrace all of Wave 1. If you are short, a good spot to take profit is around the .618 fib, depending on how it looks. Hopefully Wave 2 will be simple correction, which will be a clue later on when we are in Wave 4. As per the Elliott Wave Principal, if Wave 2 is a simple correction, Wave 4 will be a complex correction, and vice versa.
Overall, the short term is rather bearish, but depending on how it goes, there should be an amazing long opportunity for an entry for Wave 3 which is quite bullish mid to long term.
As always, good luck and happy trading!
With this in mind, Wave 2 can retrace all of Wave 1, so the maximum that it will fall will be 2200 for this to be valid. Typically, Wave 2 will retrace 50% - 78.6% of Wave 1, but remember that it can retrace all of Wave 1. If you are short, a good spot to take profit is around the .618 fib, depending on how it looks. Hopefully Wave 2 will be simple correction, which will be a clue later on when we are in Wave 4. As per the Elliott Wave Principal, if Wave 2 is a simple correction, Wave 4 will be a complex correction, and vice versa.
Overall, the short term is rather bearish, but depending on how it goes, there should be an amazing long opportunity for an entry for Wave 3 which is quite bullish mid to long term.
As always, good luck and happy trading!
