At the open of the 11/29/23 session the S&P 500 (SPX) made a new post 10/27/23 rally high. After 15 minutes the rally was exhausted, and the SPX trended down for the balance of the session. Could this be the start of a significant decline? Perhaps, however the NYSE advance/decline line was bullish, with 59% advancing stocks vs. 39% declining.
The 15 – minute SPX chart courtesy of Trading View illustrates a short- term bullish Elliott wave count.
The move up from the 11/28/23 bottom was in three- waves and the subsequent decline has so far been in three – waves. This could be the first two waves of an Elliott wave – Ending Diagonal Triangle.
Ending Diagonal Triangles are termination waves of a larger degree movements. They only appear in the fifth wave position of motive patterns and in the “C” wave position of corrective patterns. Each of the five sub waves further sub divide into three -wave patterns. Usually, the second waves of Ending Diagonal Triangles have deep retracements of the first waves, which is what happened.
A move below 4,540.51 will invalidate the pattern. If there is an Ending Diagonal Triangle developing the SPX could rally above the 11/29/23 high and possibly top 12/01/23 or 12/04/23 .
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