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January 21st, 2022: SP-500 Chart Update

Posted by pugsma on January 21, 2022

6:30 pm EST: The SP-500 opened flat from 4482, dropped to 4420, rallied to 4495 (days high), and then fall the rest of day into the close to close near the low (4395) at 4398.

Key Market Comment: It’s possible now that the P1-C3 top is in place at 4819 on January 4th, 2022. An important technical indicator here is that the NYSE A-D Line Cumulative $NYAD | SharpChart | StockCharts.com) that failed to make a new high along with SP-500 and is now rolling over hard. This nearly two month long negative divergence on a key market indicator of underlying strength. The NYSE A-D Line cumulative almost always negatively divergence significantly a key market top.

Technical Indicators:  See this SP500 vs NYMO vs VIX Chart Link: Print SharpCharts from StockCharts.com

  1. Today the Trifecta SP-500 Buy Trigger was hit for 3rd consecutive day with the SP500 close below its lower Bollinger Band, The NYMO close below its lower Bollinger Band and The VIX above its upper Bollinger Band. Remember this condition doesn’t always happen at an exact SP-500 bottom (but near it), as these indicators can remain outside their respective Bollinger Bands for 2 or 3 days as the SP-500 continues to drop. It takes a close back inside the their respective Bollinger Bands to confirm each SP-500 Buy Signals.
  2. Also, it was the 3rd consecutive day with the NYMO close below -40 and below it’s lower BB. This often leads to a big SP500 rally on the 4th day.
  3. Finally, there is a potential +DIV on the NYMO (-87, -86) vs SP500 (4500, 4398) and -DIV on the VIX (31, 29) vs SP500 (4500, 4398) closing prices from early December to today. Both of these are potentially bullish for setting a key SP500 bottom.

Wave Count Options: The primary (white/green) count is 51% probable, while the alternate (red) count is 49% probable.

  1. The original primary (white/green) and wave count is that the major [3]-P1-C3 wave peaked at 4819 on Jan 4th, 2022 and what is playing out now is a major [4]-P1 wave correction to at least the 23% Fib retrace of major [3], which is at 4393. Minor A of major [4] was the initial drop from 4819 to 4582. The minor B wave retraced to between the 62%/78% Fibs of 4729/4769 at 4749. The down from 4749 has been a minor C wave, that will likely target the 1.62*minor A level of 4365. Once major [4]-P1 is complete, the major [5]-P1 will make a new high above 4819.
  2. A new alternate (red) wave count that has P1-C3 topped at 4819 and now the P2 correction is underway to a least a 38% Fibonacci retrace of P1 down to 3821. Looking for P2 to play out as a 3-3-3 major [W]-[X]-[Y] double Zig-Zag. Minor A of major [W] completed at 4582 and minor B of major [W] retraced to 4749 (between the 62%/78% Fibs of 4729/4767). Now the minor C of major [W] wave down is underway with a target of 1.62*minor A at 4365.

Have a great weekend !

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

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