SPX And ES Both Roll Over

I was saying that the odds favored down yesterday morning, and that was a very impressive gap down this morning. So how far is this move likely to go? Well we are looking at a thrust down from a triangle that broke down on Wednesday afternoon, retested broken triangle support yesterday afternoon and is playing out towards target this morning. I have the triangle target in the 1995-2005 area, though triangles aren't as good at making target as most patterns, and there have been a couple of early turns on triangle thrusts recently. I do have a trendline target in the 1995-2000 area though, and that favors this triangle making that target.

After the triangle thrust completes there should then be a full retracement back into yesterday's high at 2067, and if we see a bounce at my trendline support target then that should continue up into at least a retest of the 2100 area. I'll be watching for that turn back up. SPX 60min chart:

Here is the similar setup on ES with the same target area. ES 60min chart:

I'm watching TF carefully today as there is a decently formed falling wedge there with wedge support current in the 1128 area. That might do a bullish underthrow but TF looks unlikely to break below 1118 at the lowest today. I'll be watching this pattern as it may well signal when the triangle thrust is likely complete. TF 60min chart:

Longer term, if SPX reaches my support trendline and reverses back up there, then we are looking at a falling megaphone on SPX that is a bull flag on the bigger picture. If we see that reversal then SPX may well then make a run back up to retest the all time high at 2134. That would be a nice place to be looking for short entries into the next few months, as Q1 2016 looks unlikely to be a fun quarter for bulls.

Stan and I are doing a free to all year end webinar next week with forecasts for next year and some for 2017. We'll also be reviewing how we did on the one we did last December. If you're interested you can sign up for that here. We've done three free webinars so far in December. Recordings have been posted for these and you can find those here.