Nothing in the price action of the S&P 500 I:GSPC suggests that the stock market is breaking down yet. The key word, however, is "yet."
The triangle on the S&P 500 that we were watching on Monday broke down into a more protracted move lower in our "alternative" wave count on Tuesday (using Elliott Wave theory). This is worth continued observation. (The S&P 500 closed Tuesday's session at 2065.89.)
It's too soon to declare oneself in the bull camp. One needs to see a better setup or a solid breakout. But that does not mean there isn't the potential for higher highs even in the more bearish wave count scenario.
The overall perspective at this time is rather simple: As long as the S&P 500 remains above 2053, the next target is 2095, with 2082/2085 being the next resistance level on a breakout.
If the index breaches 2053, with follow-through below the 2047 breakout level, however, then it will be heading down to the 2000-2020 support region.
This article is commentary by an independent contributor. At the time of publication, the author held no positions in the stocks mentioned.