The S&P 500 ($INX) remains in a major (long-term) 5-wave uptrend. February saw the $INX post a bearish spike reversal indicating it had moved into a Wave 2 selloff with a secondary (intermediate-term) target area between 3,903.17 and 3,843.51 and a possible extension to 3,723.85. Theoretical Positions: Long from the October close of 3,871.98 with a stop below the October low of 3,491.58.
The Dow Jones Industrial Average ($DOWI) also remains in a major 5-wave uptrend, though the Wave 1 high still looks to be the December mark of 34,712.28. The Wave 2 target area is between 32,715.34 and 31,686.61, with a possible extension to 30,657.88. Theoretical Positions: Long from at least the October settlement of 32,732.95 if not the breakout of the September high at 32,504.04.
The Nasdaq ($NASX) extended its major uptrend to a high of 12,269.55 during before closing lower for the month. Theoretical Positions: Long from the October close of 10,988.15 with a stop below the October low of 10,092.94.
The US 10-year T-note (ZN) remains in a major 5-wave uptrend with the February selloff looking to be Wave 2 of the major pattern. This wave looks to be nearing its end as the ZN approaches the target price of 110-133 while weekly stochastics sit well below the oversold level of 20%. Theoretical Positions: It’s possible longs might’ve been established at the November close of 113-070 based on monthly stochastics and a possible 2-month reversal. If so, stops would be placed below the October low of 108.265. Additional longs could be established when the ZN completes a bullish secondary reversal pattern on its weekly chart.
