The US SPX 500 CFD has every chance of confirming a trend peak at a significant Fibonacci cluster today.
This comes at what could be the end of a 5 swing advance, setting up for a correction of the whole rally from the mid November low at 1343
This set up assumes that after a 5 swing advance, a peak that’s made at or very close to a cluster of Fibonacci projections has an increased probability of being the peak that defines the end of the whole 5 swing advance.
The Fibonacci cluster shown on this chart consists of:
- A projection that the swing up from 4 to 5 will be 38.2% of the length of the move from 0 to 3 and
- A projection that the 4/5 swing will be 161.8% of the length of the correction from 3 back to 4
A move below or overlap through the peak at “3” (1532) would be further evidence that a significant correction is underway
Editing Tracker’s Fibonacci measures
I’ve used Tracker’s Fibonacci price tool to project the length of the 0/3 swing from 4
For the external retracement of the 3/4 correction, I’ve applied the Fib retracement tool backwards, clicking first on 4 and then on 3.
After our new release over the weekend, it’s now possible to edit both the retracement and Fib price tools. For this set up, I find it useful to show only potential clusters on the chart and get rid of all the other Fib measures. This makes it easier to see the wood from the trees. You can also set default values so to begin with Tracker calculates only the projections you most commonly use.
You edit Fibonacci values by
- Hovering your mouse over the Fib lines on the chart
- Clicking the round edit button that appears
- Editing the Fib values to whatever you chose. In the box below I’ve deleted all except the 38.2% projection