The S&P 500 Shows Signs of Strength in August, Bulls Are Back in the Game
The S&P 500 experienced a nice slowdown in August, following the seasonality chart. However, a huge green weekly candlestick emerged, indicating strong bullish momentum. This suggests that stocks will likely continue in an uptrend amidst current risk-on sentiment. How soon will the S&P 500 reach new all-time highs?
Analyzing the 4-hour chart from an Elliott wave perspective, we observe a sharp three-wave A-B-C decline, signaling a correction within the uptrend. The impulsive recovery and broken trend line point to an extended third wave rise towards the 5600 area, resembling a wave (3) of a five-wave bullish impulse. This indicates further upside potential after any short-term retracement, with the condition that the price remains above the 5358 level for confirmation. Falling below this level could trigger more complex corrections.
In conclusion, the recent bullish activity in the S&P 500 suggests a potential for continued upward movement in the market. Investors should keep a close eye on key levels and market dynamics to make informed decisions about their financial strategies.