By: Jeff Cooper
Hit and Run Bonus Report: December 27, 2022
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Last week I suggested that there is a possibility Intermediate Wave 3 down in the bear has not begun.
The monthly line close only chart showed last week indicated Intermediate Wave 1 bottomed on October 13th.
From there, a contratrend A Wave of Intermediate Wave 2 up topped on December 1.
If the SPX can reclaim 3890-3900, the presumption is that the B Wave down of Intermediate Wave 2 dropped into a bottom on Thursday of last week.
This ties to a perfected 50% retrace of the October 13 low to the December 1st peak.
If correct Wave C up of Intermediate 2 is on the table.
This idea gains credence if the SPX can advance above the 4000 region (red ellipse).
This is where the bottom of the green rising trend channel intersects with the dominating blue declining trend line for 2022.
3890 (389) is 180 degrees opposite the first week of January (ties to the ATH) and 4080-4090 (408-409) is square the first week of January.
Obviously, these numbers are also square the October low in Time and Price -- 3500 (350).
I have drawn a rising trend line connecting the June low and the early September low (purple).
Notice when that trend line snapped it perpetuated a flush to the low of the year in October.
Extending the purple trend line shows it bisects the top of the green trend channel in the 4250-4300 region in January.
Notice how this ties to the black horizontal line which defines the low of the 1st leg down in January and the August high (4325).
I have left the moving averages off the bottom daily for 2022 for clarity’s sake.
However, it must be said that the 200 day moving average is currently at 4018 which ties to the bottom of the green trend channel and the blue 2022 Line of Most Resistance.