Assuming the S&P 500 (SPX) 02/12/24 top holds, there are two levels where short-term bottoms could occur.
The daily SPX chart courtesy of Trading View illustrates Fibonacci retracement levels and Volume Profile.”
Fibonacci ratios are typically areas where markets or stocks could retrace to on any time scale. In this case the largest SPX price movement for potential retracement is the rally from late October 2023 to early February 2024.
The first significant Fibonacci ratio retracement level is .382 just below the early January 2024 correction. The next potential Fibonacci retracement level is .50 in the middle of an SPX late November to early December narrow sideways movement.
The “Volume Profile” illustrates trading volume on a vertical axis, which matches volume with price levels. The widest volume profile is called the “Point of Control” (POC) which could become support/resistance for price movements.
Usually if POC aligns with a Fibonacci retracement level it could be very strong support/resistance. In this case the primary POC is above the .382 retracement level. However, the next largest POC area lines up with the .50 Fibonacci retracement.
The daily S&P 500 ($SPX) Point & Figure (PF) chart courtesy of StockCharts.com gives a different perspective.
Point and figure charts are a way to visualize price movements and trends in an asset without regard to the amount of time that passes. Rallies are represented by the letter “X” declines by the letter “O”. Clusters of “X’s” and “O”s” illustrate potential support/resistance. The wider the cluster, the stronger the potential support/resistance zone.
There’s PF support in the 4,500 area which corresponds with the secondary POC and .50 Fibonacci retracement of the October to February rally.
It’s possible the SPX could make a minor bottom near the Primary POC around 4,750, bounce and then make a more significant low in the 4,500 zone.
Time frame for a possible bottom around 4,500 could be two to four weeks.
Four Dimension Trading 