SPX Is Still Pushing Higher Ahead Of The Holiday

Today we saw the market move higher breaking the previous high at the 5524 level. From a larger degree perspective, this move to new highs does not change the count in any way, and on the smaller timeframes we simply count this as an extension of the wave (5) of v. We still need to see a break under support to give us an initial signal that we have put in a larger degree top and until we actually see a break of that support this market can still continue to grind higher. We are still seeing divergences in both the Down and the Russell 2000 so although the SPX and Nasdaq are still grinding higher this is push to new highs is not being seen widely in all of the indexes. This action is still supportive of the overall market working on a larger degree top so I still remain cautious in this region. 

Upper support as shown on the five-minute chart is now coming in at the 5503-5490 zone. We will need to see a break under that zone followed by a break back under the 5447 low to signal that we have indeed put in a local top. From there we still would need to see a break under the 5406-5365 zone to further confirm that a larger degree top may have been struck. This should also come in the form of five waves down and if and when we see that five down we can better define the next shorter term downside targets. For now, however, we still need to wait for that break of support before we have a clearly defined downside setup in place and again until that support breaks we still can see the market, and specifically the SPX and Nasdaq, continue to grind higher before that larger degree top is indeed seen. 

As I have been noting while the pattern remains quite full we still do not have confirmation that a top is indeed in place just yet. Once we do see that confirmation we will have plenty of time to trade the short side of this market but for now and until that does occur further sloppy action in the very near term may indeed be the name of the game.