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SPX Update: Intermediate Low in Place?


While there's still work to do, bulls have taken the first steps toward validating an intermediate bottom.

MINYANVILLE ORIGINAL In Wednesday's update, I noted that the market had likely put in a bottom at 1403 SPX, and I suggested a rally would begin to unfold. I also published a short-term target of 1430-1432 for the S&P 500 (INDEXSP:.INX), and on Thursday, the SPX came within 1.65 of my target. The bulls have now taken the first steps toward validating an intermediate bottom, but there is still some work to do before we can declare the bears out-of-the-running.

My work suggests that an intermediate low is in place, and the market is now headed toward the (first) intermediate target of 1480-1490, but any trade beneath 1403 would invalidate that outlook. The first step for bulls to gain confidence is to overlap the key 1430.64 price point. Conversely, over the short-term, sustained trade beneath 1416 could suggest problems for the bull case.

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The hourly chart notes the alternate potential of a 2nd wave rally, though I'm only giving that potential 30% odds at the moment. I'll note the key downside levels going forward.

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