Beginning with the long-term analysis of the waves, there is again nothing to add to the detailed analysis found in this update. A sideways correction from 2014 [iii], an impulse unfolding since 2014 [iv], and a pullback of similar size of (2) following (5)’s completion followed by another impulse higher following are the strongest options if the one illustrated above in color is not taken into account. But by a fairly wide margin, the wave count in color above is preferred.
Due to the large size of an underway sideways correction from the wave [b] high relative to the previous possible corrections since (4), and taking the larger structure since (4) into account, a correction that began at 3 or [b] is very likely complete. [d] is clearly not 5 waves so a sideways correction is not beginning from that point unless it is part of something larger beginning at a previous high. Keep in mind that an impulse higher from [ii] to 3 is possible and this opens the door to a possible flat lower since [b], but the structure of this impulse is very poor, [b] is used as an impulse which is not natural, and the side of [a] is then very small relative to [ii] which it would need to be paired with.
The best option for a continued climb higher is an impulse or ending diagonal wave underway since 4. The problem with this however is the lack of respect for the ~1965 support area on an intraday basis. The area was violated as a very large and deeply retracing wave lower since (5) has been unfolding.
At first the 3-wave looking move down to [b] this week followed by a structure resembling 5 waves higher gave a bullish look to the market. However the breakdown that followed has moved the short-term expectation back to the bearish side. A double zigzag down from 5 to (i) is a good option, but the surrounding context brings doubt to this possibility. Again, the size and retracement level of the sell-off relative to 5 is a problem, but also the action today following (i). i is very large and deep relative to the pause within (ii) and these is not a typical feature of a series of 1-2 waves higher; the corrections of waves tend to be no larger than the corrections of the larger waves that they are contained in. Wave (ii) retraced a large amount of (i), but it is about the same size as [ii] and the waves following (ii) are strongly on the bearish side.
Of the wave counts that try to make an upward correction higher since 1 or [b] live on, the best involve a double or flat since 1. These again face the challenge of dealing with waves after (ii) however and have an added layer of complexity which is not desirable. Perhaps there is an ending diagonal underway since (i), but this is a stretch.
A complete impulse down since 2 would simplify the situation and work better with the action after (i) (and also allow for an additional rally above (ii) perhaps fully retracing (i)), but it would be very unusual. There are just so few waves to work with at the bottom of the action today when attempting to balance out the [ii] region. Better is an impulse down from (a) of [ii] to (i) but this also requires corrective waves that are out of proportion with one another.
As it has no structural problems, although it is a rare pattern, perhaps the best option worth considering besides the one in color is a 3-3-3-3-3 leading diagonal lower since 5 where its 4th or 5th wave is underway. This allows a move above (ii), but not by much (wedging must be preserved).
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