The 06/27/22 blog “S&P 500 Could Rally to 4,100” noted that a break above S&P 500 (SPX) resistance in the 3940 area could open a move to moderate resistance at 4,020 and possibly 4,100. On 06/28/22 the SPX marginally broke above 3,940 and then declined.
The SPX broke below support that was noted at 3,890, opening the door for a drop that continued through out the session.
What happened on 06/28/22 was another sign that US stocks are probably in a bear market. In a bull market, an early session break above resistance typically would ignite a day long rally.
The Nasdaq Composite (IXIC) has the clearest Elliott wave count that was illustrated in the 06/23/22 blog “Prelude to a Short – Term Bottom?”.
The daily IXIC chart courtesy of Trading View updates the Elliott wave count.
Its possible the decline from 06/28/22 is Minute wave “b” – boxed of a developing Minor wave “4”. If so it could rally into a .236 Fibonacci retracement of the IXIC – November 2021 to June 2022 decline.
If the IXIC breaks below the 06/30/22 bottom at 10,850.01 it could mean that Minor wave “4” is complete and headed to significant support in the 10,250 area.