Fri 4/27/2012. Yes, I know.

(Update Tues 5/1/12 12PM EST)
Today's SPX rally supports either (A) a 5th wave rally to the 1440s or higher or (B) a 4th wave 3-3-5 flat needing one more drop to retest/pierce 1357. The latter scenario would allow SPX to fall short of its April high while Dow has already surpassed its own. The short-term technicals are bullish so shorting is dangerous without a 4-candle support break at a minimum. My May 3rd +/- cycle low projection looks unlikely unless the market really tanks over the next week. I mentioned recently that May 18th almost qualified as a cycle low but narrowly missed my standards, so I'll throw out the possibility that SPX plans to bottom between those 2 dates likely (May 7-14ish) allowing for an OPEX max pain bounce back to 1380-1400. That bottom could end the B scenario or just be a lull in the A scenario. Regardless of pattern, I still think SPX will be stuck in the same basic range for 1-2 more months with maybe a short-lived 2% piercing above or below. Good luck.
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Yes, I know that stock market analysis and economic analysis are 2 different things. But, I interpret the GDP data to indicate a slowing economy or one that is stabilizing at a weak level which ain't good given the humongous deficit spending undertaken by Congress and the Fed at the expense of our long-term future. However, the data is not weak enough to be a siren call for QE3 either, and that's probably not a good thing for a stock market that has traveled fast since March 2009 and October 2011. Earnings have formed a similar story: better than expectations but generally slowing with warning signs. The US Dollar is also hanging in there.

Of course, that has no bearing on short-terms SPX action but it does fit with a bull market top any month now which is good to know if one is investing or swing-trading intermediate trends. My discretionary spending analysis allowed for a significant top around April 9 or June 1 depending on your interpretation of bull or bear market. My cycle analysis called for "a" low around May 3rd and another one around June 4th. Terry Laundry's work suggests late June or early July should be a big top or bottom and breadth is at a short-term decision point now. OEW has been expecting SPX weakness to 1300-1340 followed by new highs into late 2012.

So, I've amalgamated all that data into a projection for weakness in April and strength in May with uncertainty in Jun/Jul depending on whether SPX 1320ish holds into early May. The April weakness has panned out but not as much as anticipated...thus far. If the SPX breakout out 1393 becomes support, we'll obviously retest/break the highs. Either way, it's looking more and more likely that SPX 1320 and probably even 1340-1356 will hold. That makes a new high in late May or early June very likely regardless of pattern. We'll know better in a week or so after the April jobs report is released on Friday May 4th.

As far as my current personal short trade goes, I will likely lighten up my position on any retest of 1390-1394 near breakeven and set a stop at today's high for the rest with possible reload if 1390 becomes resistance again. Until then, I'll give SPX a little more rope and hope it doesn't hang me more than 1-2%. Good luck.