We continue to analyze the situation on the SPX500 index from the point of view of Elliott theory. It is assumed that a large impulse trend is being formed, which is marked by five sub-waves of the cycle degree I-II-III-IV-V.
Perhaps the first three parts of the impulse pattern are fully completed, and there is a possibility that the cycle correction wave IV has also come to an end. It looks like a triple zigzag of the primary degree Ⓦ-Ⓧ-Ⓨ-Ⓧ-Ⓩ.
Thus, in the near future, the price may start moving up towards a maximum of 4326.34 in the final cycle wave V, which will take the form of a primary degree impulse, as shown on the chart.
Let’s also consider an alternative scenario in which the actionary wave Ⓩ will strive for equality with the wave Ⓨ.
Market participants may expect a drop in SPX500 to 3332.12. At that level, sub-waves Ⓩ and Ⓨ will be equal. Only after reaching the specified level, the price may turn around and start an upward movement. A bearish impulse wave (C) of the intermediate degree is required to complete the wave Ⓩ.
An approximate scheme of possible future movement is shown by trend lines on the chart.
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