S&P 500 Forecast: Elliott Wave Analysis Points to $6363 Target

Using the Elliott Wave Principle, we forecast the S&P 500's likely paths forward, predicting a target of $6363. The analysis suggests a strong upward trend with potential corrections along the way.

Happy New Year to new and regular readers of our work. We primarily use the Elliott Wave Principle (EWP) to forecast the financial markets—in this case, the S&P 500 's most likely paths forward. Although there are many ways to navigate the markets and to each their own, we find the EWP to be the most reliable and accurate. Our returns, see Figure 1 below, speak for themselves.

We are looking at W-iii to reach at least SPX6060, W-iv should bottom around SPX5725, and W-v can reach at least SPX6260. We must allow it to ideally target SPX6060, possibly as high as SPX6175, before the next correction of around 5-7% can start. The market should bottom out at around $5850+/-50 for a green W-a, bounce to $6000-6025 for a green W-b and that a green W-c of the red W-iv should bottom out around $5735-5810 over the coming days before W-v can reach at least $6280. It then bottomed out on December 20 at $5982. We expected $5850+/-50. Thus, with an accuracy of around ±2%, we reliably anticipated using the EWP where the index should top and bottom up to two months ahead. Of course, we could not know the exact path the market would take. Still, as more price data became available, we could specify the expected path, increasing our accuracy to less than ±0.5%. We, therefore, continue to assign the index's advance since the August 2024 low an Ending Diagonal (ED) structure. As a reminder, an ED’s waves (i-ii-iii-iv-v) comprise three waves: 3-3-3-3-3=abc-abc-abc-abc-abc. Besides, W-iii typically targets the 123.60% extension of W-i, measured from W-ii. The W-iv then tends to correct back to the 61.80% extension, after which the last W-v targets the 161.80% extension. Since, so far, the index is running a bit ahead, e.g., it held the 76.40% extension, we now anticipate it is more likely to reach the 176.40% extension at $6363. See Figure 2 above. But, as always, we will monitor the advance to narrow down the red W-v target zon

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