May 11, 2022

S&P 500 / Elliott Wave Update 5/11/2022 by Michael Filighera

Wednesday’s trade was full of sudden bursts of buying and selling as the ES broke higher again attempting to reach resistance at 4070 and as the ES broke lower reaching 3948 and eventually below to a session low at 3924.  It was an incredible trading day no matter if you trade a small account, medium account or large account – there was plenty to fill everyone’s risk profile.

The Elliott count is again getting cluttered with extensions — too many I feel – but I need the market to clear it up before changing it.  I still believe we have additional downside to finish before getting a more sustained bounce higher.  That bounce would not be expected to change the longer-term trend, but the shorter time frame charts will be green for sure. The moving averages continued to point lower up to and including the Daily.

For tomorrow, downside still carries the potential to get ugly, real ugly and what I mean by “ugly” is very volatile, very fast, swings coming all of sudden and reversed just as fast — but it will be tradeable.  There may be additional upside to put in before the NQ turns and heads for new lows under 3924. Again, I continue to look to the MA’s for resistance levels.  Additional Fibonacci support for the decline comes in at 3915, 3873, 3836, 3797, and then 3751 to 3734 where a stronger bounce is probable.  Additional downside support remains at 3675, 3599, 3500, 3480.  While ultimately I see the Intermediate wave 3 bottom coming in closer to 3400 there are several “layers” or steps of 4th wave rallies and 5th wave declines to unfold before the larger Intermediate wave 3 is complete — so it won’t be a straight shot down.  Expect stair stepping rallies and declines.