* See UPDATE below...
After briefly breaking above the confluence of a +10 standard deviation of a long-term uptrending regression channel with the outer band of a Fibonacci spiral (1.618 coefficient) on a monthly timeframe, the S&P 500 Index (SPX) has begun to retrace much of its breakout, as shown on the following monthly chart.
We may see a retest of 4250 or 4200 before the monthly uptrend either resumes, or if price drops and holds below 4200, we could see a significant 20-40% correction occur from its top at 4545.85.
See my last post on the SPX for more details on what I'm monitoring on this index.
* UPDATE October 8...
The long-term arc on the SPX monthly chart below has narrowed and has gone parabolic...a condition I first noted in my post of August 27.
Investors could be in for a very volatile ride this fall...keep an eye on whether there will be catastrophic global contagion from China's troubled $62 Trillion real estate sector, as described in my post of September 15.
If so, the 20-40% correction mentioned above could be swift.
