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Decline coming... but a first a bounce to SPX 1140.

|Includes: SPDR S&P 500 Trust ETF (SPY)

On July 16th I outlined some possible Elliot wave counts. Unfortunately I jumped the gun when last weeks decline started looking impulsive. Friday, with a break out above 1099.46 SPX we can eliminate the count calling for an immediate decline. Here is one of the charts I posted but with the updated price action.

With Friday's close, other momentum signals have reversed and now also support a rise than continue for several more days. The 1130 -1140 area represents a strong target, that will be between the 50% and 61.8% retracement level as well the 4th wave extreme, another common stopping point. Throw in the 200 DMA and we have a nice cluster of targets within 10 points or so. I'll be watching the charts for signs of exhaustion such as a momentum divergence like the one occurring near the top of the (a) wave.

Disclosure: Long SPY puts.