Kenny showed the H&S pattern. I show a slightly differing variation but downside targets are the same. I think though that this H&S pattern would be a battleground for several reasons. 1) The H&S neckline would be forming on the all important Primary wave 1, Intermediate wave (4) C-E line. 2) A breakdown of this neckline represents a move back into Primary wave 1 parameters and trendlines and 3) of course a loss of the neckline would mean a lower SPX H&S target in the 730's around the 62% Fib mark or lower depending on where the breakdown would occur. Basically calling the rally into question (which is what a wave 2 is supposed to do.)So I favor the H&S neckline staging a false breakdown to 757 and then it reverses and recovers and smokes some bears who piled on at the neckline break. Sounds like something the MM's would do.
But mostly I do not favor this rally getting stuffed back deep inside old Primary wave 1 trendlines. There is much support at 750 area. But these are some things to look out for. A neckline that cannot recover means the lower retrace targets for wave 2 will likely be hit.
