The Options shown in the 10 min charts below are the different ways to count the move down from 1219.80. There are 5 that I'm following and you can see the larger context of each on the 60 min counts page.
Options 1, 2, 4 and 5 imply that the rally from the 1 July low is correcting the decline from 1131.23 only, so will be invalidated above 1131.23. The count on the chart of Option 3 anticipates rather more upside even though it is also a corrective move, since it is correcting the whole decline from 1219.80, not just the decline from 1131.23.
On the charts of Options 1, 2, 4 and 5 I have labelled a double zig zag count from the 1 July low ay 1010.91.
If its complete at today's high, then for Options 1 and 2 we would now be about to start a 3rd of a 3rd wave down at various degrees - both very bearish. For Option 4, we would be about to start wave (iii) of [c] of minor Y down - temporarily bearish. For Option 5, we would be about to start (iii) of [c] of minor Y down - again, temporarily bearish.
On the chart of Option 3 I've labelled a single zig zag which would be minute [c] of minor 2 up. It does not yet look complete. However, note, the double zig zag count could also be applied here since that has retraced a sufficient amount of the decline from 1219.80 to be a minor 2 correction of that drop. If that completed today and we apply it to the chart of Option 3, it means that we should be starting minor 3 down now.
Here's how things stand after today:
Option 1 - Wave (ii) of [iii] topped at 1131.23
10 min chart:
Five waves down from 1131.23 on this Option represents wave i of (iii) of [iii] of minor 1. The double zig zag I have labelled from the 1010.91 low would be wave ii of (iii), so implies that we would be in wave iii of (iii) once the correction of the decline from 1131.23 is complete.
Its possible to count the double zig zag as complete at today's high. At that level, [Y] is about .70.7 x [W]. Also, within [Y], wave (C) is just over 1.618 x wave (A). Also, its about a .886% retracment of the decline from 1131.23.
If wave ii is not complete, then the level to watch remains 1131.23 on any further rally. Exceeding that level will invalidate the count (though it won't preclude a continuing correction in wave (ii) - see the commentary on the 60 min counts page).
On the downside, the main level to watch is initially 1096.38. If that is taken out, it rules out the extending wave (3) shown on the chart below. After that, there is the low at 1065.25. If that is taken out, the chances are good that the corrective move is over. Until then, the risk remains that any declines will simply be a precursor to new highs.
Five waves down from 1131.23 on this Option represents wave i of (iii) of [iii] of minor 1. The double zig zag I have labelled from the 1010.91 low would be wave ii of (iii), so implies that we would be in wave iii of (iii) once the correction of the decline from 1131.23 is complete.
Its possible to count the double zig zag as complete at today's high. At that level, [Y] is about .70.7 x [W]. Also, within [Y], wave (C) is just over 1.618 x wave (A). Also, its about a .886% retracment of the decline from 1131.23.
If wave ii is not complete, then the level to watch remains 1131.23 on any further rally. Exceeding that level will invalidate the count (though it won't preclude a continuing correction in wave (ii) - see the commentary on the 60 min counts page).
On the downside, the main level to watch is initially 1096.38. If that is taken out, it rules out the extending wave (3) shown on the chart below. After that, there is the low at 1065.25. If that is taken out, the chances are good that the corrective move is over. Until then, the risk remains that any declines will simply be a precursor to new highs.
Option 2 - Wave [ii] topped at 1131.23
10 min chart:
For this Option, five waves down from 1131.23 represent wave (i) of [iii] of minor 1 down. The double zig zag up from 1010.91 would be wave (ii) of [iii], so, assuming its complete, we would be about to start wave (iii) of [iii] down.
This is the same labelling as on the chart of Option 1 for the rally from 1 July (although the wave degrees are different), so the invalidation point and the levels to watch on the downside are the same.
For this Option, five waves down from 1131.23 represent wave (i) of [iii] of minor 1 down. The double zig zag up from 1010.91 would be wave (ii) of [iii], so, assuming its complete, we would be about to start wave (iii) of [iii] down.
This is the same labelling as on the chart of Option 1 for the rally from 1 July (although the wave degrees are different), so the invalidation point and the levels to watch on the downside are the same.
Option 3 - Ending diagonal complete at 1010.91
10 min chart:
For this Option, 5 waves down from 1131.23 to 1010.91 could be wave [v] of a leading diagonal down from 1219.80 and, therefore, minor wave 1.
It places us now in minute [c] of minor wave 2 up.
It remains to be seen whether we completed wave (iii) of [c] at today's high or only wave i of (iii) of [c].
If we completed wave (iii) today any wave (iv) pullback has to stay above 1088.96. If its only wave i of (iii), then we have to stay above 1065.25 on any pullback in wave ii of (iii). These are the levels to watch to rule out one or other of the counts.
As mentioned above, its possible to apply the double zig zag count to this Option given how far that has retraced. If we do that and that double zig zag is complete at today's high, then minor 2 should be over and we should now be starting minor 3 down. So far, we haven't moved down in a manner that suggests this is the case, but it may still be too early to tell. For the time being, we just have to watch the levels mentioned and while they remain intact, further upside potential will remain.
It places us now in minute [c] of minor wave 2 up.
It remains to be seen whether we completed wave (iii) of [c] at today's high or only wave i of (iii) of [c].
If we completed wave (iii) today any wave (iv) pullback has to stay above 1088.96. If its only wave i of (iii), then we have to stay above 1065.25 on any pullback in wave ii of (iii). These are the levels to watch to rule out one or other of the counts.
As mentioned above, its possible to apply the double zig zag count to this Option given how far that has retraced. If we do that and that double zig zag is complete at today's high, then minor 2 should be over and we should now be starting minor 3 down. So far, we haven't moved down in a manner that suggests this is the case, but it may still be too early to tell. For the time being, we just have to watch the levels mentioned and while they remain intact, further upside potential will remain.
Option 4 - Wave [b] of minor Y within intermediate (X) topped at 1131.23
10 min chart:
For this Option, 5 waves down from 1131.23 would be wave (i) of [c] of minor Y and the double zig zag up from 1010.91 would be wave (ii) of [c].
For this Option, 5 waves down from 1131.23 would be wave (i) of [c] of minor Y and the double zig zag up from 1010.91 would be wave (ii) of [c].
However, as mentioned previously, counting a complete 5 waves down to 1010.91 does bring in the possibility that wave [c] of Y is done so we have also completed intermediate wave (X) - see the 60 min counts page. That would put us now in a minor wave A rally and eventually take us to new highs. If wave (X) did end at 1010.91, then, looking at the chart of Option 3, the high marked [a] would be wave [i] of A and the low marked [b] would be wave [ii] of A - see the bullish alternate chart for Option 4 on the 60 min counts page.
For the moment, I've assumed we are completing a double zig zag for wave (ii) of [c], if it is not already complete at today's high.
If we take out 1131.23, then the bullish possibility mentioned above is likely to be playing out, assuming Option 4 is the correct count on the bigger picture.
Option 5 - Minor wave X within intermediate wave (X) topped at 1131.23. Now in minor Y down
10 min chart:
On this Option, 5 waves down to 1010.91 would be wave [a] of minor Y down and the retracement would be wave [b]. If its over, we would now be headed down again in wave [c] to complete minor Y.
This is the same double zig zag shown for Options 1, 2 and 4, so the same invalidation point and levels to watch stated for options 1, 2 and 4 apply here.
Here is the updated 1 min chart of the double zig zag, showing the count for 5 waves up from the 1065.25 low (this 5 waves would be wave [C] of a second zig zag for Options 1, 2, 4 and 5, or it could be wave i of (iii) or (iii) on the Option 3 chart).
SPX 1 min - from 1065.25:
It shows either a complete 5 waves up at today's high, followed by a (1)-(2) down (see the chart posted in the 20:00 BST update), or wave (3) still in progress with wave 4 of (3) possibly forming a triangle.
Based on the above chart, if we take out 1096.38, in an assumed wave 4 of (3) pullback, the sub-dividing wave (3) is out and its likely that we completed 5 waves at today's high. On Options 1, 2, 4 and 5, that should mark the end of the second zig zag and complete the correction of the decline from 1131.23. On Option 3, it could be wave (iii) of [c] or just wave i of (iii) of [c].
Here's a close up of the single zig zag count shown on the chart of Option 3:
SPX 1 min - single zig zag:
You can see that from today's high, there may be a triangle forming. That would suggest that today's high was wave (iii) of [c], not i of (iii), since the triangle would have to be a 4th wave. If correct, then one more high should see the end of this zig zag.
If a double zig zag from 1010.91 is complete at today's high, we should start to drop impulsively (because one of the bearish Options (1, 2, 4 or 5 would be playing out). If we don't, the risk remains that there may be more upside to come with the 3rd wave of the last leg of the second zig zag still in progress or more upside to correct the decline from 1219.80, if option 3 is playing out. Or, it increases the chance that one of the even more bullish possibilities mentioned above and on the 60 min counts page may be at work.
On this Option, 5 waves down to 1010.91 would be wave [a] of minor Y down and the retracement would be wave [b]. If its over, we would now be headed down again in wave [c] to complete minor Y.
This is the same double zig zag shown for Options 1, 2 and 4, so the same invalidation point and levels to watch stated for options 1, 2 and 4 apply here.
Here is the updated 1 min chart of the double zig zag, showing the count for 5 waves up from the 1065.25 low (this 5 waves would be wave [C] of a second zig zag for Options 1, 2, 4 and 5, or it could be wave i of (iii) or (iii) on the Option 3 chart).
SPX 1 min - from 1065.25:
It shows either a complete 5 waves up at today's high, followed by a (1)-(2) down (see the chart posted in the 20:00 BST update), or wave (3) still in progress with wave 4 of (3) possibly forming a triangle.
Based on the above chart, if we take out 1096.38, in an assumed wave 4 of (3) pullback, the sub-dividing wave (3) is out and its likely that we completed 5 waves at today's high. On Options 1, 2, 4 and 5, that should mark the end of the second zig zag and complete the correction of the decline from 1131.23. On Option 3, it could be wave (iii) of [c] or just wave i of (iii) of [c].
Here's a close up of the single zig zag count shown on the chart of Option 3:
SPX 1 min - single zig zag:
You can see that from today's high, there may be a triangle forming. That would suggest that today's high was wave (iii) of [c], not i of (iii), since the triangle would have to be a 4th wave. If correct, then one more high should see the end of this zig zag.
If a double zig zag from 1010.91 is complete at today's high, we should start to drop impulsively (because one of the bearish Options (1, 2, 4 or 5 would be playing out). If we don't, the risk remains that there may be more upside to come with the 3rd wave of the last leg of the second zig zag still in progress or more upside to correct the decline from 1219.80, if option 3 is playing out. Or, it increases the chance that one of the even more bullish possibilities mentioned above and on the 60 min counts page may be at work.
