SPX 500 Price Cycle Analysis

I don’t talk about price/wave analysis much on here mainly because it’s complex and takes a lot to explain - plus, it has so many utilities to it that without understanding those utilities its conversation is pointless.

The S&P500 is at the stage of this price cycle w

here we either get a new 1–3-week leg higher (into next Fed Meeting) and fail, hard, or at the cycle where we close bearish this month and go risk off into the Fed meeting.

Given that most portfolio managers and market participants tend to be overly optimistic I lean toward one last leg higher into March. However, that doesn’t mean I want to get long it just means that I believe there is one leg more and that is an exhaustive leg. That analysis translates, for me, into how I:

• Size trades

• Duration of trades

• Structure long/short ideas

For example, as a risk model utility, it gets me risk off. From a day trading utility, it gives me context to understand that we are not in an impulsive leg higher but an exhaustive/distribution leg which means my expectations for how price action SHOULD react changes.

I explain in the video below some of these concepts. If we close this week and/or monthly candle below $4910 then we likely are in new corrective wave lower for the market into March - that depends, in my view, on the economic data today and the Fed speakers. Whether you realize this or not, where we are right now in the SPX price cycle is VERY important and what is said by the Fed is going to dictate the next 2-3 months of money flows.

Premium members video below diving into this further as well as trade insights to NVDA and a few others.