With the scenario of building a right hand shoulder out of the way, S&P is pushing lower towards its longer term support levels forming a downward wedge that could reach 1720-1700 if it extends further. S&P after having broken its support at 1770-68 price level, moved sharply to its next support at 1748-40 area where the 50% Fibonacci retracement of the rise from 1646 is.
S&P is now trading near the lower boundaries of the upward sloping channel that comes from 1343. This long-term chart can be seen in the chart we post below. The current decline from 1850 looks impulsive and the volume near the highs remains in much higher levels than in any other level, implying that we have not seen the low yet.
The price range 1775-1795 is now important resistance from a price and volume perspective. The decline looks unfinished from 1798. Another new lower low can be expected and with 1724 as target. 1729-30 is also a key support level as a previous top was made at this area.
The last chart shown above is an update of a past tweet. I used the yellow boxed area to show the area where I expected a low to be formed. Prices have reached the lower boundaries of my marked area and the blue upward sloping trend line and a few points above the red horizontal support. I think that chances of a bounce have increased although the form of the decline indicates that this is not a normal or usual correction. This is something bigger that could put the longer-term bullish trend in danger.