In the face of the aftermath of the horrific terrorist act Friday night in Paris, the after hours action in the market indicated at least a 1% drop in the S&P 500, DOW and NASDAQ…everything came crashing down with the attacks after hours. But..
When I look at the 30 day 1 minute chart of the S&P 500, I see a potential bottom scenario..the fact that VIX will likely spike to the mid 20’s on Monday is why I’m seeing this exact scenario.
The first wave down was from 2117 to 2070 or about 47 points, the upward 2 rallied from 2068 to 2087, and the downward 3, if 1.618 X W1 would target the 2000-2006 range in the S&P 500.
I’m betting the VIX will hit the magic 23-25 mark at the open on Monday, while S&P 500 hits the lower end of 1.618 at the stated 2000-2006 range, and we end up seeing an upward 4…the rally off the open MUST hit 382 to this W4 level: 2031-2037 intraday or within the next couple of days to stop the Wave 3 finally, and we get the 5th wave down and reversal back over 2070 and beyond in a pure bottom.
So far it just looks like a Wave 2 correction, and the VIX hitting the 23-25 magic number on Monday will help a lot.
We need these readings:
VIX: 23-25 , S&P 500 holding 2000 and .382 W4 back to 2031-2037
We get those readings this fearful period in the market would be over.