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. On the count on the chart of Option 3 that rally 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 complete double zig zag count from the 1 July low ay 1010.91.
If it did complete at 1020.95, then for Options 1 and 2 we have started a 3rd of a 3rd wave down at various degrees - both very bearish. For Option 4, we have started wave (iii) of [c] of minor Y down - temporarily bearish. For Option 5, we have started wave (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 still 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 at 1020.95 and we apply it to the chart of Option 3, it means that we have started 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.
As mentioned above, if we had a double zig zag up from the July low, it counts as complete at 1020.95. The possibility that the decline from that high was wave 4 of (3) of [C] of the second zig zag was ruled out today when we dropped below 1096.38.
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.
As mentioned above, if we had a double zig zag up from the July low, it counts as complete at 1020.95. The possibility that the decline from that high was wave 4 of (3) of [C] of the second zig zag was ruled out today when we dropped below 1096.38.
So, I'm counting the decline from 1020.95 as the start of a 3rd wave down - on this Option, its wave iii of (iii) of [iii] of minor 1.
This 5 min chart shows two possibilities. It shows today's decline as either wave 1 of (3) or wave (3) itself:
SPX 5 min - (1)-(2)-1-2 down from 1020.95:
If the decline is wave 1 of (3), the rally from today's low would be wave 2. The invalidation point for this is the wave (2) high at 1115.90. If that is taken out, the the likelihood is that we are in the single zig zag count (see Option 3 below).
If today's decline was wave (3), then the wave (4) retracement must not end above the wave (1) low at 1109.78. If that is taken out, then we have to look to the main count labelled and wait to see if that gets invalidated by moving above 1115.90.
At the moment, I prefer the main count - wave 2 has retraced 61.8% of wave 1, which is exactly what you'd expect of a 2nd wave. I think it would also have a better look to it if we get an extended wave (3), but the market will have to decide.
And here's a close up of the move from the high at 1020.95:
SPX 1 min - close up of decline from 1020.95:
Looking to the downside, the main level to watch is initially today's low at 1092.82. Taking that out will increase the odds that this is the correct count. After that, we want to watch 1088.96 since taking out that low will reduce the likelihood that we are in the single zig zag count (see Option 3 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 of new highs remains.
This 5 min chart shows two possibilities. It shows today's decline as either wave 1 of (3) or wave (3) itself:
SPX 5 min - (1)-(2)-1-2 down from 1020.95:
If the decline is wave 1 of (3), the rally from today's low would be wave 2. The invalidation point for this is the wave (2) high at 1115.90. If that is taken out, the the likelihood is that we are in the single zig zag count (see Option 3 below).
If today's decline was wave (3), then the wave (4) retracement must not end above the wave (1) low at 1109.78. If that is taken out, then we have to look to the main count labelled and wait to see if that gets invalidated by moving above 1115.90.
At the moment, I prefer the main count - wave 2 has retraced 61.8% of wave 1, which is exactly what you'd expect of a 2nd wave. I think it would also have a better look to it if we get an extended wave (3), but the market will have to decide.
And here's a close up of the move from the high at 1020.95:
SPX 1 min - close up of decline from 1020.95:
Looking to the downside, the main level to watch is initially today's low at 1092.82. Taking that out will increase the odds that this is the correct count. After that, we want to watch 1088.96 since taking out that low will reduce the likelihood that we are in the single zig zag count (see Option 3 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 of new highs remains.
Option 2 - Wave [ii] topped at 1131.23
10 min chart:
For this Option, five waves down from 1131.23 represents 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 now be in 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 please refer to the comments and 1 and 5 min charts posted under that Option.
For this Option, five waves down from 1131.23 represents 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 now be in 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 please refer to the comments and 1 and 5 min charts posted under that Option.
Option 3 - Ending diagonal complete at 1010.91
10 min chart:
For this Option, 5 waves down from 1131.23 to 1010.91 would 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.
If this count is in play, then it looks like we completed wave (iv) of [c] at today's low and we are now in wave (v) of [c] up to complete the zig zag.
Here's the chart from the July low which includes the alternate count:
SPX 1 min - wave [c] of minor 2 from the July low:
And here's a close up of the action from the 1020.95 high (wave (iii):
SPX 1 min - wave (iv) of [c] (or wave ii of (iii) of [c]):
So far, this wave (iv) pullback has stayed above 1088.96 and it looks like we may have started wave (v) up. If we take out that level before making a new high, then that will rule out the wave (iv) count. Looking at the close up chart above, an early warning that the count may be wrong would probably come if we take out the wave i high at 1097.20 assuming the labelling is correct and we are in wave iv of (v). Its possible that where I have wave iii is actually only wave [1] of iii, in which case, only taking out the wave ii low at 1093.75 on an assumed wave [2] of iii pullback would invalidate it.
The possibility that the 1020.95 high was only wave i of (iii) would then be in play. We have to stay above 1065.25 for that to remain valid.
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 did complete at the 1020.95 high, then minor 2 should be over and we should now have started minor 3 down.
It places us now in minute [c] of minor wave 2 up.
If this count is in play, then it looks like we completed wave (iv) of [c] at today's low and we are now in wave (v) of [c] up to complete the zig zag.
Here's the chart from the July low which includes the alternate count:
SPX 1 min - wave [c] of minor 2 from the July low:
And here's a close up of the action from the 1020.95 high (wave (iii):
SPX 1 min - wave (iv) of [c] (or wave ii of (iii) of [c]):
So far, this wave (iv) pullback has stayed above 1088.96 and it looks like we may have started wave (v) up. If we take out that level before making a new high, then that will rule out the wave (iv) count. Looking at the close up chart above, an early warning that the count may be wrong would probably come if we take out the wave i high at 1097.20 assuming the labelling is correct and we are in wave iv of (v). Its possible that where I have wave iii is actually only wave [1] of iii, in which case, only taking out the wave ii low at 1093.75 on an assumed wave [2] of iii pullback would invalidate it.
The possibility that the 1020.95 high was only wave i of (iii) would then be in play. We have to stay above 1065.25 for that to remain valid.
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 did complete at the 1020.95 high, then minor 2 should be over and we should now have started minor 3 down.
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]. With that complete, we would now be in wave (iii) of [c] down.
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]. With that complete, we would now be in wave (iii) of [c] down.
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, the possible counts for the move up from there are shown on the 60 min chart of the bullish alternate count for Option 4 on the 60 min counts page and on the 1 min chart posted here - its the last chart.
For the moment, I've assumed we completed a double zig zag for wave (ii) of [c] at 1020.95. Please refer to the comments and 1 and 5 min charts posted under Option 1 above.
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 please see the comments and 1 and 5 min charts posted under Option 1 above.
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 please see the comments and 1 and 5 min charts posted under Option 1 above.
