The chart is slowly making some sense again, and I've revised my target here for SPX 1768 next Thursday, October 31, by 3:00 PM EDT. The rest of this week should be some pullback, either mild to the 1740 area, or a little more, enough to overlap the earlier high at 1729. Either way, next week sees continued dollar weakness and happy rally into the FOMC.
I still suspect that after October FOMC we get a nasty surprise with the November POMO schedule, i.e. less than $85B planned. This may send us 40 handles straight down in the final hour Thursday, a reversal that begins the great Bear Market of 2013-2015.
So we've got two ending diagonals. We've got the near-term one we are in now:
|SPX 10-22 6M|
And we've got this monster one we've been in since SPX 1266. We will revisit the SPX 1266 area next August.
|SPX 10-22 2Y|
Long-term bottom target is SPX 568 on March 30, 2015. And you know what happens then ...