As we predicted last week on Monday (February 25, 2013), the bottom of the down trend was at 1,485 on the $SPX.

We also said that the new uptrend, the beginning of which was confirm last week Tuesday (February 26, 2013), would be composed of 3 legs:

(1) up 35-40 points: 1,525 : wave i
(2) a small pullback 1,501: wave ii
(3) a second 35 or so point advance : wave iii.

Within this wave iii, we see on the hourly the first leg up to 1,520, a leg down to 1,512 and now underway a second leg up to a target of 1,538, which will clear the recent resistance of Feb 19. It will then pull back to the new support (previously resistance) of 1,527 - 1,530, and possibly reach new highs targeted at 1,565.

A close below the recent 1,512 on the $SPX  or  14,030 on the DOW will invalidate our scenario.

Next target: 1,538.