1. Little C: market sell-off returns to support at 2340 SPX into May opex, where we find support and continue to grind sideways in a long W4 that has another month to go. It's an ascending/barrier triangle with a technical target of 2480 SPX. The final (we shall see) W5 up begins with the June FOMC, where the Fed holds the discount rate steady.
2. Big C: a Brexxit-like panic sell-off of 120 handles SPX, all the way to the full .382 retrace at 2280 SPX. Critical support for the rally -- a trendline from the 1810 low -- lives down here. This capitulation move would exhaust the selling and end the larger W4. W5 would begin in earnest on Monday.
Both scenarios wrap up for a candidate top in mid-July, 2480 SPX.
|SPX wave 4 scenarios|