Max pain overrules short-term bear hopes as stocks barrel into opex

This has been a fascinating week even though frustrating for the Elliott Wave folks, and even the ChartsEdge cycles. First Ray Merriman said last Friday that a "sweet" time for Valentine's would usher in a short-term bout of optimism. Then Terry Laundry started showing a small "T" off the bounce from his lower envelope band. Trendline analysts like Andre Gratian and Marty Chenard showed the bounce was from trendline support. And technical analysts showed strength in the A/D, plus sentiment had gotten too bearish. Sure enough, "max pain" took the SPX to Tony Caldaro's 1107 pivot! Expected tomorrow - but it happened today. Maybe just in time, just before the Fed announced raising its discount rate to 0.75% - which seems to be cooling sentiment after hours.

While my time has been eclipsed by some special projects, I can certainly post charts of the SPX, technicals and sentiment that somewhat speak for themselves. The SPX 1108 level tested both the 34 and 50 day moving averages. We've been expecting for weeks now that the better tradable low will come in March. Equities are now trying to scare some into buying lest they miss the boat. Friday might still squeeze a bit more, but after tomorrow which is Feb. 19 - which some believe is a turn date - that leaves at least two, maybe two and a half weeks to see what the next cyclic low will send our way.

It seems unlikely the SPX could mount over its 34 and 50 day MA's without turbulence. Assuming we get a turn coming up, the next question will be whether we get a new low on the next drop. We're expecting a better buying opportunity in March, either way.

The McClellan chart is an example of what we're expecting. The Oscillator has entered overbought territory on this spike, so it's warning that it can roll over again. While the Summation Index has continued curling up, boding well longer-term. After more time passes, it'll be interesting to see what the SI does at its own 50-dma - but there'll be enough time for that.