Software likely underperforms the rest of Tech in July Array ( [cookie] => 99a439-fa94bc-fc5545-4c2ae2-19f9e1 [current_usage] => 2 [max_usage] => 2 [current_usage_crypto] => 0 [max_usage_crypto] => 2 [lock] => 1 [message] => [error] => [active_member] => 0 [subscriber] => 0 [role] => [visitor_id] => 208366 [user_id] => [reason] => [method] => ) 1 and can accesss
The immediate pattern in SPX remains choppy and resembles a fourth-wave triangle pattern which requires one final pullback to new lows before bottoming. After Tuesday’s decline, which brought prices right down to key near-term one-month uptrend line support, it’s difficult to make the case for an imminent breakdown. SPX requires a move down under 3738 to suggest a retest of June lows is imminent. Until that happens, one cannot rule out a bounce post Wednesday’s CPI number, which might reach 3980-4045 temporarily before rolling back over to new lows into late July. As seen below, these triangle patterns as part of existing downtrends can prove choppy as has been seen over the last month. Yet, an ultimate break back down under 3636 is probable into late July before US indices start to bottom out and rally into September.
QQQ formation vs SPY should move to new lows into late July before bottoming
One chart that sheds some meaningful light as to the potential direction of QQQ and of the broader Equity market happens when viewing the relative chart of QQQ vs SPY. As shown below, this has bounced over the last couple months, but has done so in a very overlapping, choppy manner. This is insightful as it shows us that QQQ has likely not yet officially bottomed vs. SPY when viewed from Elliott-wave style analysis. (Overlapping choppy waves are typically counter-trend moves, and the resolution typically comes in a break toward the direction of the original trend… in this case, down).


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