SP500 keeps moving lower and remains under pressure since the January highs. The market even GAPPED lower this week, which invalidated the previous idea that we might be in a wave four pullback within a diagonal formation. Instead, it now looks more likely that a fifth wave is already in place, and that we are in a higher degree corrective pattern.
If this view is correct, the decline could extend toward the 6370 to 6500 support area. That zone could offer a more interesting place for potential stabilization, especially if the market manages to stay below 6772. Overlap with this price would invalidate the idea of a bearish incomplete impulse within wave C, out of a larger wave B triangle.
Also keep an eye on the Sunday gap around 6700, which may act as important resistance at the start of the week. A bounce toward that level followed by a new turn lower would still fit the bearish scenario.
For those waiting for bullish signals, there are two options. Either wait for this drop from 6970 to complete, or wait for a clear overlap and daily close above 6772, which would increase confidence that a low is already in place. When zooming out, it feels like time is running out for bulls, and the risk of a higher degree correction is clearly increasing.
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