ORIGINAL POST:  11:15 AM

In something akin to a recess appointment, the market is making a run for our target area (the rectangle in the chart below) during a holiday-shortened trading session.  We’ll look at the chances it has of getting there and the most likely impediments.

First, the little pullback we had to the midline yesterday was the 10-15 points I’d been discussing.  I wondered whether we’d get something bigger, but this morning’s action lays that option to rest.  It does, however, open the door to a bigger pullback at the 1.272 coming up.

continued…

By now, everyone is familiar with the purple channel we’ve been in since the 1266 lows on June 4.    I’ve also talked about the possibility of a rising wedge coming into play — the dashed purple trend line cutting across the tops made the past 5 weeks or so.

Note the 1.272 of the smaller (red) Crab pattern just above at 1378.20.  Crabs reverse at the 1.618, not 1.272.  Yet, many Crab patterns put in a little pause, or even mini-reversal at other key Fib levels along the way.

If we got a reversal off 1378 and close back under the rising wedge upper bound at, say, 1372, it would leave the rising wedge option alive while keeping the very strong upward momentum intact.

Note that the 1.272 of 1378.20 is very close to the larger (purple) pattern’s .707 of 1376.78 — lending credence to the idea of an interim reversal there.  The likely target is the Fib level around 1363 — the larger pattern’s .618 and our previous high.

RSI, meanwhile, seems very content to bump along right on its midline.  A close up shows just how easy it would be to arrive at our ultimate destination without any extraordinary measures.

Will we get to 1378 today?  It’s possible.  At the very least, we’ll have further legitimatized the rising wedge with another tag (and probable close) on its upper bound.  Remember, the rising wedge gets us up over 1404 (the Inverse H&S target and Fibonacci .886 of the drop from 1422 (Apr 2) to 1266 (June 4) — which has been in our sites for weeks.

If it isn’t today, it’ll be soon.  As I posted the other day, my concern isn’t whether we’re likely to get to 1389-1404, it’s knowing what to expect after we do.  I’m updating those charts and will post them in another hour or so.

GLTA