S&P500 Update: The Correction Became Increasingly More Complex. Where Could It End?

Elliot Wave Analysis of the S&P 500

Until last week, the continuous correction in the S&P 500 (SPX) that I'd been following using the Elliott Wave Principle (EWP) had followed a conventional Fibonacci-based impulse pattern quite well (SF-BIP). For more than a month, just a few modifications were required. Thus, by last week, the index had done enough to the negative (see here) for the correction to be considered complete, as it had completed five waves down from the March 29 rebound high.

However, it chose to give us another "curveball" by dropping below the previous week's low. This dip adds to the continuing price action's intricacy and provides more evidence that the current price action is corrective since the all-time high (ATH). "I will have to adjust my present POV on a dip below last week's low," I said last week, and I will do so in this update.

S&P 500 Forecast and Bottom Line

Last week, the S&P500 had all the components to "either... rebound to preferably SPX4340+/-20 from whence I predict a last c-wave down to end the correction at SPX3750+/-25." Alternatively, the correction is ended and the index is on its way to about SPX4325+/-25. Before the wave-ii to new ATHs begins, I estimate a wave-ii fall to about SPX4100+/-75. On a decline below last week's low, I'll have to rethink my present outlook." As a result of last Friday's dip, I had to adjust my outlook, and the index is currently at a fork in the road:

Hold around today's lows for a rise above yesterday's high to SPX4160, then drop to 4050 and rally to 4225 for a more substantial impulsive route. Alternatively, we may drop below last Friday's low, preferably SPX3732-3762, before looking for another probable upward impulse.