The market made a new low today but the entire move was retraced, the market actually closed positive. The move down was not expected but possible as mentioned yesterday. A triangle still appears to have occurred but it has been relabeled.
Wave [iv] is not entirely clear, but an attempt at a count is made. A double zigzag count is shown but waves (w) and (y) are not well proportioned on a time scale. There are nice distance proportions however with the formation fitting within a channel nicely. Prices clearly broke out of the channel today. There are certainly alternative counts for [iv] but the wave does appear to have ended.
In my estimation, wave [v] of C of (Y) of [2] is underway with wave (i) of [v] possibly complete. There are various wave counts at this point, some are shown in the chart above. In any case, I would expect strength in the market tomorrow as the heart of wave [v] is probably still ahead. It is possible that the previous high of wave [iii] will only be slightly exceeded (or [v] truncates) but wave [v] still looks small at this point. But as discussed in previous posts, the rally since March 2009 is nearly over. Expect it to complete before Labor Day at the latest; early next week seems more likely.
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