Ninety Seven Percent Retracement

Just after the open on 06/01/21 the S&P 500 (SPX) reached 4234.12 which is a 97.8% retracement of the decline from 4238.04 to 4056.88.  The maximum retracement of the supposed  impulse wave down from 4238.04 is 99.9%, in Elliott wave rules a 100% retracement would eliminate the bearish wave count. 

The 30-minute SPX chart courtesy of Trading View illustrates the action after the all-time high.

One-minute after the open the SPX hit a  rising trend line connecting the 05/14/21 and 05/25/21 tops – then trended down.

The SPX rally from the 05/12/21 bottom is choppy – the signature of a corrective pattern of the main trend.  The Dow Jones Industrial Average and the Nasdaq Composite continue to lag the SPX.  The 30-minute RSI had a double bearish divergence on the 06/01/21 SPX high.

The SPX all-time high is the key price area and holding below that level keeps  the bear case intact.

Traders were stopped out of 50% of a 100% short position when the SPX moved above 4220.00 Continue holding 50% short.     

Published by Mark Rivest

Independent investment advisor, trader, and writer. Articles have appeared on Technical Analysis of Stocks and Commodities , Traders.com Advantage, Futuresmag.com, and Finance Magnates.

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