The S&P 500’s Larger Correction Is Underway, but It Can Still Allow for New All-Time Highs

Author: Dr. Arnout Ter Schure

Published: March 10, 2026

Summary

The S&P 500 index has recently breached the 6780 level, indicating that a larger correction is in progress. Despite this, the correction may still allow for the index to reach new highs around 7120 before a more significant decline occurs.

Current Market Sentiment

As of the last trading session, the S&P 500 was down only 3.5% from its all-time high of 6978, achieved on January 27. This resilience raises questions about the current bearish sentiment, especially as the VIX index spiked to nearly 30, its highest level since the previous year’s corrections. The article suggests that the market's reaction may be overly pessimistic given the relatively minor pullback.

Technical Analysis

The author utilizes a line chart to analyze the S&P 500's performance, emphasizing the importance of closing prices in technical analysis. The recent decline has been characterized as a complex correction, described as a triple zigzag pattern, which complicates forecasting future movements.

Elliott Wave Analysis

The article discusses the Elliott Wave theory, indicating that the index's recent movements can be categorized into specific wave patterns. The author notes that the index reached a low of 6636, which aligns with the anticipated targets based on previous analysis. The potential for a rally exists, with expectations that the index could reach 7120-7190 before experiencing further declines.

Future Projections

Looking ahead, the author anticipates that if the index can maintain levels above 6636, it may set the stage for an irregular flat correction, which could see new all-time highs before a downturn later in the year. The analysis incorporates historical patterns and timing cycles to support these projections.

Conclusion

In conclusion, while the S&P 500 is undergoing a correction, there remains a possibility for new highs before a more significant decline. The analysis highlights the complexity of market movements and the importance of technical indicators in forecasting future trends.