SPX500 has rallied through 4400-20 potential resistance zone as the counter trend rally gathered pace. The indice is either carving a lower degree wave ii within primary wave 3, or is still carving primary wave 2 as an expended flat.
If wave ii of 3 is unfolding, SPX500 might prepare to turn lower from here and drag towards 4150 at least as iii of 3 begins to unfold. Also note that prices have reached the fibonacci 0.618 retracement of the drop between 4485 and 4270 levels.
SPX500 needs to stay below 4485 mark for the above count to remain valid. High probability remains for a drop towards 4150 and 4000 mark going forward. Traders might be preparing to initiate fresh short positions here.
Alternatively, if an expanded flat is unfolding as potential wave 2 termination, SPX500 might test at least 4485 levels before reversing lower again. Also note that prices could push higher towards 4500-10 levels before termination wave 2.
Either way, SPX500 might be preparing to reverse lower towards 4150 and 4000 against 4551 high. Traders might want to position themselves accordingly on the short side with potential target below 4000 mark.
Finacademy Technical Team
Gold prices dropped through $1773 lows on Thursday before finding support again. The drop from $1793 was in-line with price action of a gartley.
The US dollar index might have carved a lower high around 96.50 mark on Tuesday. The index dropped through 95.80 levels on Wednesday before finding some support.
USDJPY is soon approaching a formidable resistance zone around the 114.40-50 mark. The currency pair has been carving a corrective rally since 112.50 lows.