The market action seen today brings serious doubt to the larger picture presented in yesterday's update. With low confidence, the same count is being used in this update. If the 78.6% retracement level is broken, the count is likely not correct. Note that the Dow Jones Industrial Average has already reached 78.6% retracement. Prices need to reverse tomorrow if the count is to remain valid.
The move higher today may be best suited as a "3rd of a 3rd" wave. This makes sense given its breadth, size, and structure. On the other hand, the rally's initial rally counts well as a zigzag structure. If there is sideways consolidation tomorrow, an impulse higher since the 7/6 or 7/1 low is the next best count. This is suggested above in the alternate counts.
The market is very overbought at this time. As seen during the February-March 2010 rally however, a rally can persist for some time following this condition. In other words if there is actually a different wave pattern unfolding such as a flat wave suggested in some of the alternates above, the overbought condition will become more overbought.
The larger view has not changed.
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