A Show of Clarity

The short-term action has prompted some change to the wave count options since 2011.  A zigzag or impulse wave developing since the 2009 low is still most likely where an impulse wave higher is unfolding since the 2011 [2] or (2) lows, but within this wave an ending diagonal since the 2013-4 lows of 4, [ii] or [iv] are now weak possibilities.  This is because there is now a high likelihood of a new all-time high where the 1975.65 invalidation target will be reached.  The reasons for this are stated in a moment.

The incomplete impulse possibilities since 2013 [iv], from 4 to [iii], and since 2014 [iv] remain weak structures.  The wave count in color above does not use these components.  It does require wave (4) to be the flat which has problems, but there is not much choice anymore; even a sideways pattern underway since [iii] probably utilizes this flat.

From i to (2), a triangle works well due to the wave (1) and (2) structures that resemble 3 wave movements.  But besides the ending diagonal possibilities that were once strong, there are no good ways to describe an impulse higher since (2) that is incomplete; some weak structure mentioned in the previous paragraph must be used.

The structure of the decline since 3 had bearish potential until the (c) of [a/w] wave was heavily retraced.  The move on Friday to the origination of (c) in what is so far 3 waves gives an extremely bullish look to the decline.  [a/w] can be complete where an impulse wave higher is now unfolding, or [a/w] can be just the first leg of a larger correction (e.g. a double zigzag or flat).

Assuming there will be a new all-time high, the potential for a corrective wave higher, at least one where 1975.65 is not exceeded, is bleak.  The structure since (4) is now so far above the last high that a corrective 'b' or 'x' wave underway since (4) does not make a great deal of sense.  If there is a rise above 1975.65 the the structure higher since (4) does prove to be a correction, it may be best suited as a first wave of an ending diagonal.

The short-term action since [a/w] is not particularity clear.  It can be impulsive or corrective.  If corrective, this wave may or may not reach a new all-time high before a level under [a/w] is reached to conclude a corrective wave since 3.

Read more at http://ewaveanalytics.com.