SPX500/USD (S&P 500) Market Analysis & Trading Plan

Deep Market Discovery

Technical & Elliott Wave Analysis

The SPX500 is currently in a strong uptrend, positioned in the final stages of Elliott Wave 5, following a clear impulsive wave structure from early 2023 lows (~3,800) to the current price of 6,655.

• Wave 1: ~3,800 to ~4,600
• Wave 2: Correction to ~4,200
• Wave 3: Strong move from ~4,200 to ~6,100
• Wave 4: Sideways consolidation near 5,500-6,100
• Wave 5: In progress, targeting 6,800-7,000

RSI is currently around 65-70, indicating bullish momentum with room for further upside but watch for potential bearish divergence on the next highs. Recent price action shows strong bullish momentum with minor consolidation near current levels and no major reversal patterns yet.

Key Fibonacci extensions suggest immediate targets at 6,750 (161.8% extension) and 7,000 (200% extension). Support lies in the 6,400-6,500 zone, which was previous resistance.

Latest Market News Specific to SPX500/USD

Recent economic data has influenced the SPX500 dynamics:

• Better-than-expected Q2 GDP growth at +3.8% (vs. +3.3% forecast) boosted market sentiment.
• Durable Goods Orders for August rose +2.9% month-over-month, beating expectations.
• Initial Jobless Claims at 218,000, lower than forecast, indicating a resilient labor market.
• These data points led to higher Treasury yields and reduced expectations for Fed rate cuts, adding some volatility.
• SPX500 rebounded from session lows and is attempting to settle above 6,620, eyeing the 50-day moving average at 6,648.

Overall, the market shows cautious optimism with active dip buying, but traders should be alert to potential profit-taking and volatility in the near term.

Technical Summary & Key Levels

Resistance Levels	Support Levels
6,750 (Fibonacci 161.8%)	6,500 - 6,400 (previous resistance turned support)
7,000 (Fibonacci 200% & Wave 5 target)	6,200 (stronger support zone)
7,100+ (longer-term extension)	6,000 (psychological major support)

Trading Plan for Next 1-3 Days

Primary (Bullish) Scenario

• Entry: Consider long positions on pullbacks to 6,600-6,620 or on a confirmed break above 6,660 with volume confirmation.
• Targets: 6,750 first, then 7,000 if momentum sustains.
• Stop Loss: Below 6,500 to protect against downside risk.
• Risk/Reward: Favorable, approximately 1:3.
• Notes: Watch RSI for bearish divergence; tighten stops if signs of exhaustion appear.

Alternative (Bearish) Scenario

• Trigger: Failure to hold 6,600 support or rejection near 6,660-6,670 with bearish reversal candle.
• Entry: Short positions on break below 6,600 with volume.
• Targets: 6,500, then 6,400 and possibly 6,200 if selling intensifies.
• Stop Loss: Above 6,670 to limit losses.
• Notes: Increased volatility expected; manage position size carefully.

Risk Management & Final Notes

• Limit position size to 1-2% of portfolio risk per trade.
• Consider scaling into positions rather than full exposure at once.
• Monitor daily closes and volume for confirmation of breakout or breakdown.
• Be prepared for increased volatility in early October, a historically volatile month.
• Maintain discipline with stop losses and be ready to adjust bias if key support or resistance levels break.