The NYMO cycle is up.
It has climbed a long way to the zero line.
So, it is possible this is all corrective.
If so, Cycle should turn back down probably by end of week.
On the other hand, it can climb quite a ways to the up side.
Price has recovered from last weeks lows and is joggling about the middle keltner and 50 day MA.
This is neutral. The question is whether it decides to take a trip back to the upper keltner or go down to the lower keltner.
Problematic for bulls is that the magenta internal trend line I have been tracking got busted and got a nice kiss good bye.
The upper keltner appears to be rolling over too, which is not a good sign.
However, I do have a gap target at SPX 2468.11. This bull market has been very diligent about closing up gaps.
A move that closes the gap but fails to break the 8/16 highs or recapture the broken trend line could be interesting from a bear perspective.
I have gap targets below as well, which are intriguing as the 200 day MA looks like it will soon converge with the lower keltner.
I have left marked with light blue lines all the unclosed gaps over the last year that have been left behind. Amazing.
Perhaps the most important gap I have marked in orange, the opening gap for the year.
Typically, the January low is not the low for the year (though it was in 2013).
A vigorous 10% bull market correction from the August high could close that gap and would not be remarkable historically.
This is NOT a prediction. I have no idea what will happen.
It is just interesting to ponder that a kind of normal 10 % correction is probably inconceivable to most market participants right now.
Yet many could list events and things that could trigger such a thing.
I am a little long on two setups. I don't trust the action in this light pre-holiday week so I am honoring the protocol with small size.
I am prepared to close out and reverse if things break down.
I don't expect a big thrust one way or the other until September.
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