S&P500 short-term: BINGO!

At 10:23:17 ET, based on recent action, i posted an Alternate Bullish View:



And here's what transpired shortly after:



Bingo! As proposed, we broke out of the Triangle wave B with an explosive thrust! More importantly, we broke out of the downtrendline from January and closed above it.

While, most technical analysts and e-wavers i follow were looking for a rapid decline into the spx 1000 area, i'd expressed my doubts in this blog. This week's action was crucial as i theorized in my Shanghai Connection post. And the super drop in bullish sentiment didn't help.

Ok enough celebration (every dog has its day!). Where does this leave us?

Implications

A break of the downtrendline is not to be taken lightly, and to me has weakened the bearish case considerably - unless we break back below it. Look at what happened in the Shanghai Chart. Breaking back below would require super bearish effort as the trendline is downsloping.

I could be jumping the gun here, but I propose that the entire decline to 1045 was wave i, with a wave ii rebound in progress right now. This is what i've maintained all this while as an alternate count.



Target?

Very short-term we're overbought, so expecting consolidation into the weekend. Looking ahead at next week, i'm suggesting a target of 1095, based on wave A = wave C. I wouldn't be entirely surprised if we reach 1104 - the area of the previous fourth wave. Other resistance levels: 1085 (38% retrace), and 1100 (50% retrace). Support will be moving along the trendline we broke.

Medium-term trend is still DOWN. Good to keep an open mind though, let the chart do the talking!

Comments?