Below Zero

Although some might think so depending on their locale, but I'm not talking about the weather. Instead, I'm talking about the fact that the Fisher Transform indicator in the daily S&P500 Index chart, below, has now made it's first close below the zero line. Although the histogram bar is too small to see, the black arrow in the lower right points to the indicator flag now showing a negative number.

SP500 Cash Index - Daily - Fisher Transform Closes Below Zero

We stated that once this indicator finds it's divergence it is a relatively smooth transition to it's lows. That said, depending on the exact Elliott Wave count lower, you can see - as in November and December of last year - that a few smaller term and smaller height humps might be made on the way down.

Prices traded low enough today to close the first gap from the top - now shown in the black circle on at the upper right. There is another gap at 2,709.80 which represents the 62% retracement of the entire move upward from December 24th. (It is not circled). That gap, too, is likely to fill.

Just as we did on the way up, we are looking to count five minuet waves down to a minute ((a)) wave lower. We have not yet completed the minuet wave i, but have a good start on it.

This is just a reminder that tomorrow is the payroll employment report before the market opens, and the count we have allows for some volatility and whipsaw around today's close. So, as always, be calm, patient and flexible.

And have a good start to your evening.

TraderJoe