Thanksgiving week closed with a plunge to the short-term megaphone VWAP. From here the SPX could either form a stop-eating internal megaphone across VWAP, reverse and break out the top of the current megaphone (orange on the chart), or plunge through VWAP to the bottom of the megaphone, which will intersect with VWAP of a larger megaphone at roughly 1790.
A plunge through VWAP would also be a plunge through the bottom of a rising wedge (silver on chart below). Elegant.
If 1790 breaks, it’s down to the bottom of a still larger megaphone, which intersects with an even larger megaphone VWAP at roughly 1760. If 1760 breaks, we’ll still see a higher high, but a serious top has started forming.
Note that the standard target for the upward breakout of the SPX May-October rising wedge is a little over 1900.