S&P 500 (SPX) has ended larger degree cycle from March 23, 2020 low (Covid-19 low) with wave I at 4743.9. The Index is currently in larger degree wave II pullback to correct the almost 2 years cycle. Down from wave I on November 22, wave 1 ended at 4652.66 and rally in wave 2 ended at 4702.87. Index then resumes lower in wave 3 towards 4585.43, bounce in wave 4 ended at 4672.95 and final leg lower wave 5 ended at 4560. This move lower also completed wave (A) in higher degree.
Wave (B) rally then ended at 4652.94 and Index has resumed lower in wave (C). Down from wave (B), wave 1 ended at 4575.42 and rally in wave 2 ended at 4599.05. Expect the Index to continue lower in wave (C). Potential target for wave (C) is 100% – 161.8% Fibonacci extension of wave (A) towards 4354.28 – 4468 area. From here, the Index should end wave ((W)) and start to rally in wave ((X)) to correct cycle from November 22, 2021 high before turning lower again. As far as pivot at 4743.9 high stays intact, expect rally to fail in the sequence of 3, 7, or 11 swing for further downside.
SPX 30 minutes Elliott Wave chart
