SPY rose from the April 7, 2025 low in wave ((1)) and reached $697.87 on January 28, 2026. It then fell in wave ((2)) to $629.23, correcting the whole move from April 2025, before turning up into wave ((3)).<\/p>\n
A move above $697.87 is still needed to remove the risk of a double correction. The rise from $629.23 is mapped as an impulse Elliott Wave structure.<\/p>\n
Wave ((i)) climbed to $658.52 and wave ((ii)) pulled back to $644.16. The next phase points to further gains to complete wave ((iii)).<\/p>\n
After wave ((iii)), a wave ((iv)) pullback is expected to correct the cycle from the April 2 low, before a final rise completes the sequence. The near-term upward case remains in place while $629.23 holds.<\/p>\n
With the market showing strength above the $629.23 pivot, we see an opportunity for income-generating strategies. Selling out-of-the-money puts, particularly with expirations in the coming weeks, allows traders to capitalize on time decay while expressing a bullish-to-neutral stance. This approach aligns with the view that any near-term weakness should find buyers, as long as that critical low from earlier this month holds.<\/p>\n
This technical setup is supported by the recent March 2026 CPI report, which came in at a manageable 2.8%, suggesting inflationary pressures are contained for now. Furthermore, with the VIX falling to a multi-month low of 14.5, the cost of options has decreased, making bullish positions more affordable. A steady unemployment rate of 3.6% also provides a stable economic backdrop for further market gains.<\/p>\n
For those targeting a move toward new all-time highs, buying call options or establishing bull call spreads offers a direct way to participate in the expected wave ((3)) advance. We are watching the previous high of $697.87 as a key level to overcome, with strikes around $700 and $710 becoming attractive targets for May and June expirations. A decisive break above that peak is needed to confirm the trend and remove the lingering risk of a more complex correction.<\/p>\n
Looking back at the market action following the lows in late 2023, we observed a similar pattern of a sharp recovery followed by brief consolidation before the next major leg higher. That period also saw traders successfully selling puts on dips, reinforcing the idea that in a confirmed uptrend, pullbacks present opportunities. We believe the current structure presents a comparable setup for derivative traders to follow.<\/p>\n
Create your live VT Markets account<\/a>\u00a0and\u00a0start trading<\/a>\u00a0now. <\/b><\/p>\n","protected":false},"excerpt":{"rendered":" SPY rebounds in Elliott Wave ((3)); needs break above $697.87; support $629.23; further upside expected.<\/p>\n","protected":false},"author":103,"featured_media":16987,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[59],"tags":[],"class_list":["post-47564","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-live-updates"],"acf":{"acf_article_selection_author":null},"aioseo_notices":[],"aioseo_head":"\n\t\t\n\t\n\t\n\t\n\t\n\n\t\t