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SPX, NDX, INDU: Did Bulls Drop the Ball on Friday?


It's too early to say for certain, but here are the key near-term levels.

MINYANVILLE ORIGINAL Bulls had every opportunity to get things done on Friday, but failed to push higher on the better-than-forecast job report. The market performed properly for the very short-term count, but not quite as expected for the next higher degree wave count. Certain corrective waves can only be anticipated in real time, since they sometimes form a complete fractal (which leads one to believe they are over), but then go on to string together a couple more fractals before actually finishing.

Near-term prospects may now be shifting into the bears' favor, so I've outlined a series of key levels to watch on the S&P 500 (INDEXSP:.INX). Be aware that until 1450 and 1439 are claimed by the bears, we can't rule out new swing highs following directly, and trade back above 1471 from here would suggest bulls have several more sessions of strength left in them -- if not more.

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Due to the fractal nature of Elliott Wave, this pattern leaves a number of potentials open at the moment, so let's take a look out across a couple more markets before coming back to SPX.

The Dow Jones Industrials (INDEXDJX:.DJI) is suggesting that -- again, assuming new highs don't follow directly -- the current wave is (at worst) part of a larger correction, and new swing highs should ultimately follow. Depending on what happens next regarding the important price levels, though, bulls may have to wait a while and endure some drawdown if they're not nimble.

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