A Bigger Recipe Setup Brewing, But With A Wrinkle (SPX)

A Bigger Recipe Setup Brewing, But With A Wrinkle (SPX)

When we get "the recipe" setup it can produce some higher-probability scenarios with specific risk vs reward. Pointedly, we are looking for the a-b and then the initial i-ii of c to form thereby giving us the risk to the top of b and the potential reward to the bottom of c inside a 5 wave Pinball structure. It is this very Pinball structure that will further confirm or begin to deny the proposed path illustrated on the chart. I know of no other method that will quickly and faithfully deliver a verdict other than EW+FP. Are there other ways to analyze the markets? Of course. Do traders and investors find success in these methods. Yes. This simply is my preferred method. Once sufficiently acquainted with this technique, one now has a powerful ally in the palm of their hand. Here's what may be identified in the coming week and the wrinkle as well. 

First, the daily context for the overall picture. It is this current segment and how the structure of price forms that will tell us what is more likely thereafter. The basic supposition is that either the long-lasting high is in place at the level struck back on 16JUL or there is OMH yet to be struck in Green. How will we differentiate between the two paths? Should a swing high be found early in the coming week then the extension below will communicate critical information for the chart. A move down in 5 waves for the Green path should terminate 4850 - 5050 region. Should price take out 4800 and continue to the 1.236-1.382 extension zone then it would favor Blue. Both would see a substantial bounce after the next low but Green would lead to a new ATH and Blue would just be corrective in nature. And now for a Red wrinkle...

This wrinkle is born from the fact that the current bounce may terminate at just .382 in time of the decline. Both Green and Red would project to a similar target in the 4850 area. It simply is how the subwaves get us there. And there is a straightforward way to identify which would be in the lead. If Red then the decline will be clearly corrective as it would be the circle 'b' of b of (iv). If Green then we are looking for a c of (iv) and the structure should be a clear 5 waves down from the next high. 

We have some variables to identify next week but we are also armed with EW+FP, an extraordinary tool with dynamic utility capabilities. I will be listening closely to what the structure of price tells us come Monday. One plausible path that I am tracking is a gap up to the target of 5395SPX and then an initial micro 5 down. That could be the recipe we are looking for to project the swing short in the Green path for c of (iv). But I'm on the lookout for any other variables. EW+FP, a powerful combo to help guide us along the path. Enjoy your weekend!