Option Investor
Update
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With SPX breaking below the bottom of its rising wedge pattern we have confirmation of the sell signal. A drop below 835 would be confirmation of the top for the rally off the March low. We should now be entering a multi-week pullback period to correct the rally at a minimum (if not head back down to a new low). Wedge patterns are typically retraced quickly (faster than it took to build them) and that could mean SPX will return to the April 1st low near 783 this week. From there we can expect a lot of choppy price action with a few whipsaws and strong bounces thrown in for good measure.

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