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SPX Update: Intermediate Buy Signal Triggered

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A fresh intermediate buy signal has triggered, so the next few sessions are critical.

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MINYANVILLE ORIGINAL Yesterday's update expected further upside, which the market provided, though it spent most of the session moving sideways. Of note, more of my intermediate indicators have shifted to buy signals. The Dow Jones Industrials Bullish Percent Index (BPINDU) shown below has now given an intermediate buy signal, and we can see from the chart that these are generally pretty solid.


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I have been marginally in favor of a bullish intermediate outcome for some time, and, given what's occurring in the indicators, I'm close to shifting to a more bullish footing -- but I'm going to give the market a couple more sessions to prove itself here. A lot can happen in a day or two in this crazy central-bank-driven market, so I'd like to see these intermediate indicators firm-up just a bit before getting too far ahead of the price action. With these types of buy signals, if they're going to fail, they generally fail almost immediately.

Both the bull and bear count remain pointed at higher prices before a meaningful top, though there are several paths the market may take to get there. Below is an hourly chart of the S&P 500 (INDEXSP:.INX).

I've shifted my preference on the short-term count back to my original read (my first read is right more often than not), which was that the 1377 swing low marked the bottom of wave (iv) of (1). The market always reserves the right to force me to adjust it again, depending on how the next few sessions develop (some of this stuff is sooooo much easier in real-time, as the market can knock certain options off the table right at the open). The next mid-term target of 1445-55 is unchanged, though the intermediate target has been adjusted higher.

Note the potential of the black alternate expanded flat: sustained trade below 1400 would suggest a target of 1379-85.


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Finally, the bearish intermediate count is still viable. There are several factors still keeping this count on the table for the time being. The next upside target for this count is 1426, which is close-by -- so that would be an interesting target for bears to try and kill the fresh buy signal.


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In conclusion, the market is still indicating that higher prices are likely before a meaningful top forms, and there are now additional signals suggesting that an intermediate low may be in place at 1343. I've outlined two possible short-term paths that should help decipher the next higher degree waves -- now all that's left is for the market to "do its thing." Trade safe.

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No positions in stocks mentioned.
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