Topping Pattern Options

Back on the morning of Tuesday 7th July I drew the arrows below on the SPX daily chart as a possible path for the strong rally I thought we were likely to see in the near future. The rally went a little higher than I expected, but so far that has been a pretty decent guide for the market action since then. Have we therefore now seen a significant high? Maybe, but we'll need to see whether bears can break back down below 2044 to trigger the double top target in the 1954 area. In the short term I'm looking for a topping pattern here to take SPX lower to an area from where we might see that double top support test. SPX daily chart:

How's the chart I posted yesterday looking? Well SPX broke below the 50 hour MA yesterday and established a short term floor at 2110. If that holds then I'll be looking for a retest of the highs before another leg down towards the 2086-8 area on a break back below 2110.

Stan & I have been looking at SPX this morning and the path we think would be more likely is a test of the 38.2% fib retrace area (and possible H&S neckline) at 2101/2, then a rally to an ideal high in the 2114/5 area (that may well also retest broken channel support), then a break back below the H&S neckline with a target in the 2070 area (near the 76.4% fib retrace).

There is a third option where the 2101/2 area is hit and then the highs area retested and if we see that then the chances that we see a bullish breakout at the highs would be highest. SPX 60min chart:

I'm trying to answer tweets during the day but I'm only really checking the markets before the open and often don't have an internet connection here. I'm just running a few swing trades this week which are short ES from 2118 (2125 SPX), short DX from 98.2, and I just added long CL from 49.35. The DX and CL trades have been covered in Stan's videos posted on theartofchart.net. Stan and I are running open (to all) webinars looking at various markets including equities, oil, forex, precious metals on the next few Sundays and you can sign up for the first one on Sunday afternoon at theartofchart.net.