SPX500: Is smart money accumulating? [Video]

Juan Maldonado Elliott Wave Street

The latest SPX500 correction has raised concerns among traders. However, a detailed analysis using Elliott Wave theory and MACD reveals a crucial signal: momentum is weakening while the price has declined. This divergence suggests a possible institutional absorption phase.

What is institutional absorption?

When retail traders panic and sell their positions, liquidity providers (Smart Money) seize the opportunity to accumulate. This behavior often signals that the market is forming a bottom before a significant upward move.

Key zone: SPX500 at 5,600

Based on Elliott Wave analysis, the 5600 level is a critical support area. The market may rebound sharply if institutional absorption is complete and selling pressure fades.

Confirmation with MACD

The MACD indicator provides additional insights:

✅ Divergence between price and momentum
✅ Declining selling pressure
✅ Potential bullish reversal signal

These factors reinforce that Smart Money will likely accumulate at this key level.

How to trade this setup

Scenario 1: If SPX500 holds the 5600 support, a potential entry could be considered with confirmation of a reversal.
Scenario 2: If the price breaks lower, waiting for a sharp reaction could provide a better entry.
Risk Management: A tight stop-loss and monitoring price action are crucial for validation.

Live analysis: Don’t miss the key details

This week’s live analysis video explores these scenarios in more depth, covering real-time examples and entry strategies.

Author

Juan Maldonado

Elliott Wave Street

Juan Maldonado has a University degree in Finance, and Foreign trade started his trading career in 2008. Since 2010 has been analyzing the markets using Elliott Wave with different strategies to spot high probability trades.

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