After powerful market moves either up or down the retracements are usually shallow. The crowd recognizes the main trend and quickly use pullbacks to participate in the trend. Elliott wave – Horizontal Triangles frequently appear in shallow corrections and could be developing in the S&P 500 (SPX).
Elliott wave – Horizontal Triangles are corrective patterns that only appear in the fourth wave position of motive waves and in the “B” wave positions of (A, B,C ) patterns. They are sideways movements that are composed of five sub – waves. Each of the sub-waves are subdivided into three segments. After completion of a Horizontal Triangle there’s usually a thrust in the direction of the main trend.
The 5 – minute SPX chart courtesy of Trading View illustrates a potential Horizontal Triangle.
With the NYSE closed on 11/24/22 for the U.S Thanksgiving day holiday, and a shortened session on 11/25/22 its possible the SPX could meander sideways for most of the week. The only potentially big market moving event is at 2:00 PM – ET – 11/23/22. That’s the release of the FOMC minutes from their prior meeting.
Important support is the SPX bottom made on 11/17/22 at 3906.54, a decisive break below that level could trigger a drop to the low 3,800 area.
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