Analysis

This technical analysis of the S&P 500, based on the Elliott Wave Principle, posits that the index is in a final upward wave (orange W-5) targeting SPX 6800 ± 25. This immediate target is supported by a confluence of Fibonacci extensions, specifically the 200% extension at 6776 and the 300% extension at 6815. The current forecast follows a recent, shallower-than-expected 2% pullback from the SPX 6699 high, prompting a re-evaluation of the wave structure. Upon reaching the 6800 level, the analysis anticipates a more significant 3-5% correction (green W-4) down to an ideal target zone of SPX 6150-6375. Following this corrective phase, a final rally to approximately SPX 7120 is projected to complete the bull market cycle that began in 2022. The analysis provides a clear risk management framework with four distinct warning levels, starting at SPX 6664 and culminating at SPX 6569, which if breached would invalidate the current bullish wave count. Notably, the forecast dismisses the market impact of external events like a government shutdown, asserting that the index follows its own technical path.