In a sign of just how over-extended this upside push has been, consider this rising wedge on the 60-min chart.  It’s not proof of an impending swoon, but put into context of our other charts, it sure has that feel.

As clean and simple as was the channel down from 1422 to 1266, the channel back up has been a mess.  I’ve redrawn it hundreds of times, as it continues to morph without rhyme or reason.   I sometimes peruse the Elliott Wave blogs out there, and I can see that many of them have also grown frustrated in trying to assign a legitimate wave count to this mess.

continued…

When it finally turns, it will be obvious what the channel should have been, but in the meantime, this is my best guess. It parallels some other very substantial channel lines over the past few years — not the mention the trend line from 1074 in October 2011 to 1266 this past June.

Of course, knowing which channel is “right” is only half the battle, as prices can theoretically rise within the channel indefinitely.  Our three best hopes for a stop at 1404-1411 were the inverse H&S target, the Fibonacci .886 and the fan line from the 2007 high.  All three have been exceeded.

We can’t be too disappointed, since these things don’t always turn on a dime.  Prices frequently push a little past their harmonic pattern targets.  At 1418.71, SPX had retraced 97.64 of its drop, qualifying as a double top as far as I’m concerned.  Of course, it needs to reverse now if that’s going to be the case.  Otherwise, the next harmonic target is 1433.

Let’s look at some other charts.

COMP:

At 3076.59 on Friday, COMP was within a .36% rally of its .886 at 3087.72.  It’s also within .78% of a measured move that indicates 3100.

FTSE:

At 586.52, UKX (FTSE) was only 3.52 short of its .886 (the larger red pattern) at 590.04 last Tuesday the 14th.   It’s only 1.2% away from current prices, though it would certainly qualify as close enough for harmonics purposes.  The yellow trend line above is actually a fan line off the 2007 top.

NYSE:

At 8080, the NYA is about 1.6% shy of its own .886 at 8211.  It has made its Inverse H&S target of 8033, and is bumping up against a solid fan line from its March 2012 high.

There are two potential harmonic patterns.  The larger purple one looks like a Bat Pattern completing at 8201.72 — about 1.4% away.   There was a very precise Point B at the .618 on July 3.

The smaller red one has already completed a Bat Pattern.  And, the fan line from the 2007 is either a few points away or has already been tagged, depending on how one draws it.

UPDATE:  2:28 PM

SPX isn’t going to go down without a fight.  Intra-day, it looks like it’s going to form a Bat Pattern at 1417.95 — 88.6% of the 1418 to 1412 drop.

UPDATE:  3:50 PM

Make that three tags of 1417.95.

 

I feel like we’re one nice little 1% intra-day pop away from many of the other indices reaching the harmonic targets discussed above — though the hanging man candle on the day argues for a reversal.   I closed out some of my more volatile/short-term positions Thursday, but continue to hold short on everything else (and long some VIX calls just for grins.)

VIX hit two very important TL’s today.  Between the yellow channel line and the white channel line, downside should be quite limited from here on.

And, the close up…

More later.