I posted before the Thanksgiving break that a bounce was in store that logically would target the 50 day SMA. Everyone and their mothers was expecting this but I don't think they (myself included) were expecting it all at once.
The interesting thing now is that many folks don't believe in this rally either. This also makes sense since everyone was expecting this bounce from an extremely oversold condition.
However, playing the contrarian here short term may also make sense for now. Since there are a few bullish wave counts and a potential inverted head and shoulders pattern one could argue that this bounce may be a little higher than most may be expecting. As always we shall see.
Bottom line is the bulls need to reclaim the 50 day SMA and the bears need to defend 1215.42.
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| SPX - 10 Min Inverted Head and Shoulders |
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| Bullish Options |
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| Alternate 1 |
If the 4-1 overlap occurs, the next logical bear count would be the nested 1-2 i-ii down. That option however, is a little bullish biased near term because that would fit with the inverted head and shoulders pattern above. Wave ii in this case would retrace wave i approximately 62-78% (1225-1243 respectively)
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| Bollinger Bands- Daily |
