No Sign Yet This Correction Is Over

The S&P 500 is undergoing a consolidation following its April advance, with the correction not yet finished. I anticipate a flat correction pattern, which, if confirmed, signals market strength and a strong subsequent rally. Investor sentiment, especially a rapid rise in bearishness and put buying, will be critical to gauging the correction's depth. Current sentiment indicators suggest the correction isn't over. We now expect it to carry into August.

We don’t believe the price consolidation following the April advance is finished (we’ve put a red box around it in the chart). What type of consolidation are we expecting? We're hoping it will be a flat.