Market looked like it would rally based on futures but at the opening bell, decided to puke.
I bought some more longs to build a medium long SPX position. If the recent wave down was an A wave, then we should be in the middle of a B wave. If so, then the target for this B wave is 1510.
Should it reach that level, I will sell a significant portion of the longs and buy me some short SPX because there is one more wave down possibly to 1480.
Even though I thought it was not really possible a few days ago, it looks like that 1480 target by Friday was not too shabby. I still expect markets to rally up to new YTD highs after this correction is over.
based on hourly, the reason why I think this B wave is evident Friday:
1. severely oversold CCIs. Smaller timeframes have broken their downtrend and are now a few hours way from spiking into 1510.
2. OBV still showing some sort of positive divergence.
3. Looking for a gap fill and test of the 20 hourly EMA.
On the daily chart, today saw a near vertical drop into sub -200 on the CCI 9. This was the lowest reading in the past year. On top of that NYMO closed below it's BB. Good odds for a quick snap back.