E-mini S&P500: Be Aware Of A 3-Wave Rally
March 27 2017We see dollar index to hit new lows of the year as EURUSD breaks above 1.0800, while stocks sold-off as Trump's health-care bill fails. E-mini S&P500 has extended its weakness from last week down to 2320 area which was our projected zone for a fifth wave of decline, highlighted last week. Question is, what is next. Well, if you are familiar with the Ellliott Wave principle, then you know that market can be ready for a bounce this week if we consider that after every five waves trend will make a change in three legs minimum, no matter what is the structure on a higher time-frame charts. So from a technical perspective, and also from a psychological point of view, when others are turning aggressively bearish on stocks, we suspect that three wave of retracement may show up on stocks, but it may be just another temporary recovery. Divergence on the RSI also indicates a potential turn. We see first support zone here near 2320 while next one stands near 2310.
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