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March 6th, 2020: SP-500 Chart Update

Posted by pugsma on March 6, 2020

11:10 am EST:  The SP-500 price opened gap down to hit 2915 and has so far rebounded to 2978.

The bullish primary (green) wave count is major [1]-P3-C3 is underway toward the 3394 area.  Within major [1], minor 1 hit 3137 and the minor 2 retraced to 2915 near the 78%/88% Fib (2918/2890).   The minor 3=1.62*minor 1 target is 3370.  The minor 4 wave 23% Fib is at 3265 and the final minor 5 push up should reach 3394.  Keep in mind that P3-C3 impulse wave that will move far beyond the 3394 high to a target area near 4552, where P3=1.62P1.  This primary (green) wave count remains valid above the P2-C3 2856 low.

The alternate (blue) wave count is that P2-C3 is still unfolding and the drop from 3994 to 2856 has only major [A]-P2-C3.   This move up from 2856 is a major [B] wave that has targeted the 50% Fib area at 3125 (so far reached 3137).  The major [B] looks like it could be playing out a contracting triangle.   Within the major [B] wave, the minor A wave reached 3137, the minor B wave dropped to 2977, the minor C wave up ended at 3130 and the minor D wave dropped to 3000.   The minor E up end at 3030 to complete major [B] triangle.   The major [C] wave will drop to a new low below 2856 with the triangle target of 2817.  The 62%/78% Fib target for the completion of major [C]-P2 is at the 2745/2577 area (50-month SMA support at 2605).  This alternate (blue) wave count remains valid above the 2347 Cycle 2 low.

The very bearish alternate (red) wave count is that the Cycle 1 (C1) of Super Cycle V (SC-V) topped at 3394 and the move down to 2856 is the Primary A (PA) of Cycle 2 (C2).   The PB wave bounce higher is underway and should reach the typical 62% Fib 3190 area.  Major [A] of PB hit 3137 and so far major [B] dropped to 2915.  The next move should be a major [C] wave up that will target the major [C]=[A] level at 3196.   Once the PB wave up completes, the massive PC wave lower will break below 2347 and should reach the typical 50%/62% Fib target area of 2031/1703 to complete the C2 wave.  This alternate (red) count would become invalid on a break above the 3394 high.

Have a great weekend !

SP-500 15-min chart:

SP500 Technical Analysis

SP-500 60-min chart:

SP500 Technical Analysis

SP-500 4-hr chart:

SP500 Technical Analysis

SP-500 daily chart:

SP500 Technical Analysis

SP-500 weekly chart:

SP500 Technical Analysis

SP-500 monthly chart:

SP500 Technical Analysis

 

54 Responses to “March 6th, 2020: SP-500 Chart Update”

  1. pugsma said

    House Keeping: I was able to find time today to update the SP500 charts and wave counts during this all important time with rapidly changing price levels.

    Have a great weekend !

  2. rat8nine said

    spx 15 – magenta lines are the .786 and .886 rt of the move from 2855.84 – 3136.72……if price drifts lower into Monday I would reset the blue median line set for the green count…

  3. rat8nine said

    tlt 60 – posted in the current thread this time:

  4. R Swaim said

    Thanks for taking the time for us in such a volatile market!

  5. MS53 said

    Primary count in keeping with election year analog with a peak in early April and drop the low point in late May, as shown on the PUG 4 hour chart.

    • pugsma said

      Yes, and of course if we don’t get the new low below 2856 early next week per the alternate (blue), then alternate (blue) will be modified to show a major [B]-P2 move up 3190 into April and a major [C]-P2 drop up 2745 into May,

      That count option would also fit the historical election year pattern of a March rally and new low in late April or May.

  6. rat8nine said

    qqq has an interesting area here, where:

    198.17 – 219.61 = .618 at 206.36
    204.11 – 208.51 = .50 at 206.31

    • rat8nine said

      qqq went right to the .886 of the intraday low to high = 204.61, while spy went to a hair over where .786 = 292.92

  7. pugsma said

    Just like when the NYSE A-D line cumulative chart was making new highs leading the market, it is now making new lows potentially indicating a new SP500 low below 2856 is likely early next week.

    https://stockcharts.com/h-sc/ui?s=%24NYAD&p=D&yr=0&mn=6&dy=0&id=p79963311521&a=386872354

  8. pugsma said

    The SP500 needs a scary 150 to 200 point plunge on Monday to hit my 2817 (triangle) to 2745 (62% Fib) targets.

    • pugsma said

      We didn’t get the big down day this past Monday and could see it next Monday in order to flush out all the sentiment gauges set a tradable low per the alternate (blue) P2-C3 low.

      A NSYE circuit breaker trip -7% drop from here at 2930 is a -205 point drop to 2725 (just below the 62% Fib for P2-C3).

      • pugsma said

        Remember the job of wave 2 (in this case P2) is to scare the crap out of everyone!

        Investors may not have been scared enough as of last Friday’s 2856 low. Breaking that low early next week would panic even the strongest bulls.

    • This would be one heckuva call PUG if it hits…

    • R Swaim said

      What a call!!!

  9. pugsma said

    Any subscribers here actually have investments in the markets during the year 1987 Black Monday?

    -22% Drop in one day!

    I was age 21 and junior electrical engineering student at Purdue University West Lafayette, Indiana in the fall of 1987. I had some mutual fund money in the markets back then. It didn’t phase me as an investor and we made it all back and then some within the next year.

    • Yes, I posted a comment earlier this week, where I went into detail of an experience I had back then ………

    • rat8nine said

      I had mutual funds….I was 29 and working as a sound editor on the tv show The Equalizer. People were stunned. I was saving up to buy my first multifamily house, so it set me back, but two years later the real estate market had finally dropped and it worked out.

    • JW said

      Yes, I was working oversees in Latin America and we were in shock and felt helpless to do much from there.

    • kazoom1618 said

      Ah, 1987 – I was toiling on a PhD in Comp Sci (AI), started my own software company, and was using Arpanet (the precursor to the internet) daily to interact with a co-creator in Australia. Didn’t get into stocks until the internet supported it (1999).

  10. kazoom1618 said

    INO weekly: (coronavirus vaccine play)

    http://schrts.co/WudAmqxg

    A stunner! +230% this week – x5 since I mentioned it in Feb.

  11. pugsma said

    I’ve been trying to describe in words this week what this chart from Cobra shows.

    Extreme lows in the NYMO (-137) like we saw on Friday Feb 28th, means that it will take 6 to 8 weeks for the final low to form.

    • pugsma said

      Pugsma said

      March 4, 2020 at 12:44 pm e
      I have want to point out something VERY important here from a historical perspective on SP-500 daily/weekly charts.

      If you look at the last four fast market declines of 10% or more, the test of the low or the lower low did not happen for 6 weeks to 8 weeks after the initial low:

      August 2011: Initial Drop Low, August 18 2011. New low on Oct 7th, 2011 (6 weeks duration)

      August 2016: Initial Drop Low, August 28th, 2016. New low on Feb 12, 2017 (5 months duration – This one was a little different in duration)

      February 2018: Initial Drop Low, Feb 9th, 2018. Test of low on April 13, 2018 (9 weeks duration)

      October 2018: Initial Drop Low, Nov 2nd, 2018. New low on Dec 28th, 2018 (8 weeks duration)

      February 2020: Initial Drop Low, Feb 29th, 2020, Test of low or new low? Date?

      • First, I want to point out what a wonderful job you have been doing, by describing in words, what has been going on these past couple of weeks. Now this chart from Cobra puts it all together to more easily understand it. One point, that I see from all this, is that there has never been this big of a drop straight down from the ATH. Also, the 2018 examples are the only ones that come close. For me, this shows that we will go lower. Whether it be from right here or do we need another rise first is about 50/50. Would appreciate any thoughts.

      • On other point, that could make a difference is the contracting triangle, that just finished on the break below 2977. It has a target of 2815 and I would imagine that it should stay below 2977 until it hits the target. I am not sure of the rules, but it seems reasonable.

      • Too bad. That would have been very valuable. Thanks, my friend.

  12. LightBearer86 said

    Hi Steve, I am looking at the monthly chart, and recall you mentioned the SMA 50 is a key channel to watch to separate the probability of C2 ongoing/over. I am not able to get data across SC3, not to mention SC1 lol

    Do you have the chart that spans across SC3? Does C2 of SC3/SC1 break the SMA 50 bull channel, as a way of creating the illusion ‘the world is coming to an end’?

    • pugsma said

      The Super Cycle II (SC-II) low was after the year 1929 crash and Great Depression. The SP500 did not exist then as it was founded March 5, 1957. Only the DJIA-30 existed during SC-I and early SC-III.

  13. pugsma said

    I don’t as a rule discuss ES Futures, but tonight is the exception to the rule.

    ES Futures opened down -137 (-3.5%) to hit 2835 area, a new low below Friday February 28th intra-day cash market low of 2856.

  14. pugsma said

    OT: Back in the early to mid 2000’s when digital photography became the standard over analog film, the hand writing was on the wall for the Eastman Kodak Company that would declare bankruptcy in 2012.

    Could we be seeing the beginning of the end for oil and oil companies with Tesla Electric Vehicles (EV’s) replacing the internal combustion engine? Oil looks to open tomorrow down -20 to -25% at $30.

  15. pugsma said

    Once this Primary 2 of Cycle 3 of Super Cycle V wave ends above the 2347 low from Dec 2018, a Primary 3 of Cycle 3 of Super Cycle V wave will head much higher into the 4500+ area over the next 5 to 10 years.

    Ask yourself what technologies will lead during this great bull wave?

    1) EV’s and autonomous EV’s will rule the roads.
    2) Autonomous Drones will rule the local sky keeping us safe and delivering packages.
    3) Streaming entertainment will increase, including streaming gaming.
    4) Online Shopping will continue to increase.
    5) Intelligent, target advertising will dominate.
    6) Social media will continue rule the news cycle.
    7) More food will be ordered online and delivered via EV’s and drones.
    8) More surgery will be done by robotic machines.
    9) Tele-doctors will diagnose use from home.

    Technology stocks will continue to lead the markets by a wide margin.

  16. In reviewing the conversation above… I am assuming we are in the RED count… You do not have a descripion of what the move would look like other than your comment that we should end above 2347.

    • pugsma said

      No, the alternate (blue) is the count that breaks 2856 but holds above 2347.

      P2-C3-SCV wave down to 62%/78% Fibs at 2745 to 2575.

      Then P3-C3-SCV wave up much higher to 4500+

    • pugsma said

      The alternate (red) count is the very bearish C2-SCV wave down below 2347 to 50%/62% Fib at 2031/1703.

  17. pugsma said

    For the alternate (blue) count P2-C3-SCV wave low, here are some levels to watch on Monday morning:

    The major [A]-P2 wave drop was 538 points (3394 to 2856)

    The major [B]-P2 triangle orthodox high was 3137.

    The major [C] targets are:

    [C] = 0.62[A] = 2803 (triangle target is 2817)

    [C] = 078[A] = 2717 (62% Fib target is 2745)

    [C] = 1.00[A] = 2599 (78% Fib target is 2577)

  18. pugsma said

    ES Futures have been limit down -5% all night.

    Europe opened down -9%.

    Remember US cash market circuit breakers are at -7%, -13% and -20%.

    Level One Breach (-7%)

    A 7% decline in the S&P 500 from the prior day’s close would trigger a level one breach, where trading is halted for 15 minutes.

    That level for regular trading on Monday is 2764.30, a 208 point drop from Friday’s close of 2972.37.

    Level Two (-13%)

    The next threshold is 13%. A decline in the S&P 500 by that much would similarly result in a 15-minute halt.

    To trigger a level-two circuit breaker Monday, the index would have to drop 386 points to 2585.96. Trading wouldn’t be interrupted if the drop came at or after 3:25 p.m.

    Level Three (-20%)

    It takes a 20% drop in the S&P 500 to trigger a level-three circuit breaker. If this happens at any point in the trading day, marketwide trading is halted for the remainder of the day.

    To hit level three on Monday, the S&P 500 would need to fall 594 points to 2,377.90.

    • LightBearer86 said

      Thanks Steve, for sharing these in the wee hours of your time. Coming from Singapore, which is onroute to be the no.1 financial hub of Asia (hopefully soon), the $STI closed 6% lower today, which is quite unprecendented outside the GFC. At the low of today, it retraced nearly exactly 78% of the move up since early 2016 what it looks like P1-C3 of the US market, abit steeper than what i had anticipated in such a short period of time for a C3 wave, but the market is always right, and Singapore is very much more exposed to the global economy due to her set up.

      Another major asian economy $HSI after today’s drop, is also close to the 62% retracement mark (about 1k points more to go). The blue count here should support the bullish counts within AxJ and emerging markets in general; whereas the red count might be more challenging to sustain the bullish outlook over the other side of the ocean. Cheers.

  19. pugsma said

    I wanted to take a look at the intraday trading chart on the year 1987 Black Monday, October 19th:

    Note that market closed on the lows on Monday down -22%

    Note that a slightly lower low (-1% lower) was hit on Tuesday October 20th.

    Note Tuesday October 20th was the ultimate low. The markets went on to make new all-time highs a year later.

  20. pugsma said

    SPY pre-market showing and open down 220 SP500 points to 2750 and at the 62% Fib at 2745.
    That would be a -7% cash market drop and would trigger step 1 circuit breaker and 15 minute pause in trading.

    • pugsma said

      2750 would also be a -19% drop from 3394 all-time just 3 weeks ago.

      -20% defines a bear market and that’s what the talking heads and headlines will read

  21. lauter1 said

    Weekly chart of $DJT (Transports) interesting area to watch. 3 wave measured move.

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