We last focused on the NYSE composite on June 3.  The index had fallen almost 1,000 points in a month, closing just below our 7340 target and earning us a quick 7% since our previous forecast.  It was catch-a-falling-knife time:

It also appears from the RSI and channel charts I’ve drawn over the weekend that a slightly lower value would be the perfect fit… though the daily RSI tags on that dotted white TL, combined with the positive divergence, argue that we’ve bottomed already…. A bounce off the fan/channel would likely retrace to the .886 Fib…

We did indeed bottom out during the following session.  Since then, NYA has climbed back nearly 10%, up to the Fibonacci .618 (so far) of the previous decline.  It’s taken longer than anticipated, but we’re generally following our previously forecast path (the dashed blue line.)

In that June 3 post, we raised a number of important issues relating to the ultimate target.  The chart above, for instance, shows a large potential H&S pattern forming.  That pattern, in turn, is vying for the job as right shoulder of a much larger H&S pattern.

In the short run, NYA presents a very straight forward chart.  There are a pair of channels to consider — along with an Inverse H&S target that intersects them as early as the next few days.

We also have the makings of a Gartley or Bat pattern.  Note the July 3 Point B at the .618 retracement of the March – June decline and a tentative Point C within the red channel.  Gartleys complete at the .786 after a .618 reversal.  Here, that signals 8091.24.  And, Bat Patterns complete at the .886, or 8201.

But, the intriguing price level is that of the Inverse H&S target at 8033.  It’s 3.066% higher than today’s close.

If SPX were to tack on 3.066% to today’s close of 1363, it would reach 1404 — which just so happens to be the upper end of our target price range.  Of course, then we’d have to decide whether there’s more potential upside or not.

To be continued…