22:21 BST - SPX Update

Still no resolution yet to the question whether we're in a deep 2nd wave retracement of the decline from 1131.23 or a shallower 2nd wave retracement of the decline from 1082.60 or a 4th wave retracement or something more bullish that will take us back above 1131.23.


Remember, the Options listed below are the different ways to count the move down from 1219.80. There are 5 that I'm following and they are set out on the 60 min counts page. 


On the chart of each Option I have labelled one of the 4 Counts (numbered 1,2,4 and 5) that I'm following for the decline from 1131.23. Each of these Counts could apply to any one of the Options, though what they mean may differ depending on which Option you are looking at.

Here's how things stand after today:

Option 1 - Wave (ii) of [iii] topped at 1131.23

7 min chart:

I've applied Count 1 to the chart of this Option. It assumes that we completed 5 waves down from 1131.23 at the low of 1010.91. From that low, I've labelled an incomplete double zig zag.  It assumes we've completed  the first zig zag in a double zig zag at today's high. We are now in an [X] wave before the next leg of the rally to complete the 2nd wave. It will probably have to be a zig zag in order to retrace a decent amount of the drop from 1131.23.


This Count is invalidated below 1010.91. If that happens, then one of the other Counts, 2, 4 or 5, is in operation and we have not yet completed 5 waves down from 1131.23.

Option 2 - Wave [ii] topped at 1131.23

7 min chart:

This is Count 2 which has us in the 5th wave of a 5 wave drop from 1131.23 extending.

The low of 1010.91 is labelled as the 3rd wave of the 5th wave and today's high is labelled as the 4th wave. I've labelled the decline from today's high as part of the 5th wave which will complete 5 waves down from 1131.23.

The Count as labelled will be invalidated above 1042.50. In that event, I'll look to the incomplete double zig zag count I was following today and expect a deeper wave [4] retracement.

Option 3 - Wave [iv] of an ending diagonal completed at 1131.23

7 min chart:

I've also applied Count 2 to the chart of this Option. So, we have started the 5th wave down to complete 5 waves down from 1131.23. Again, the Count as labelled is invalidated above 1042.50. Remember that for this Option to remain valid, we need to stay above 999.83 for the 5th wave of the leading diagonal.


The bullish alternative, that we bottomed in wave [v] of a leading diagonal down from 1219.80 at the low of  1010.91 low remains. It will only be invalidated if we drop below 1010.91.

Option 4 - Wave [b] of minor Y within intermediate [X] topped at 1131.23

15 min chart:

I've applied Count 4 to the chart of this Option. It puts us in an extending 3rd wave down from 1131.23. I've marked today's high as the end of wave ii of (iii), but it could have more to go if we are seeing an incomplete double zig zag from 1010.91.



The Count as labelled is invalidated above 1042.50 and if that happens, I'll switch focus to the incomplete double zig zag count and look for a deeper retracement in wave ii of (iii).


The retracement can't exceed 1082.60 if this count is correct.

Option 5 - Minor wave X within intermediate wave [X] topped at 1131.23. Now in minor Y down

8 min chart:

On the chart of this Option I've applied Count 5 which puts us in an extending 3rd wave off the 1131.23 high, but we'd be further along into it than under Count 4 shown on the chart of Option 4 above - we'd be into wave v of (iii) now, if we topped in wave iv at today's high.

The Count as labelled is invalid above 1042.50 and provided we stay above 1010.91, the incomplete double zig zag count will come into effect.

For completeness, here are the two charts I was following today, which label the move from 1010.91, one showing a double zig zag complete at 1042.50 and the other showing a double zig zag still in progress:

Double zig zag complete:

On-going double zig zag:

19:22 BST SPX Update

Possible 5 waves down from today's high complete for wave [1] of v (but it looks like it could extend):

SPX 1 min chart - double zig zag complete at 1042.50:

On the single zig zag count, it may be a complete x wave:

 

18:36 BST SPX Update

Counts quite nicely as 3 waves down so far. On the completed double zig zag count posted earlier, it would be the first 3 waves down in an impulse. On the single zig zag count, it could just be a zig zag for an X wave.

Here's the completed double zig zag count on a 1 min chart:

If we take out 1035.81 on this current rally from the low, which would be wave (4), that invalidates the implse wave count as labelled.

17:27 BST SPX Update

Here's a possible count for a top to this move up from 1010.91. Its the double zig zag count shown earlier but now complete, with a leading diagonal 1st wave down in the next down leg.

Today's high is the invalidation point for this count. 

SPX 1 min completed double zig zag:

On the single zig zag count, the move off today's high could be the A wave of an X wave . That would become the main count if we take out today's highs.

16:25 BST SPX Update

I've been following 5 Counts for the move down from 1131.23, but I've now dropped what was Count 2 which had an extending 5th wave containing 3 nested ones and twos within it. That's because it had reached the same position as the labelling I was showing for Count 3 which was an extending 5th wave but with only 2 nested ones and twos within it. So, that leaves 4 counts for the decline from 1131.23 (what was Count 3 is now Count 2, but I've left the other Counts numbered as before to avoid confusion if looking back in the archives).

Here are the charts for each of the counts:


Count 1 5 min chart:

Count 2 5 min chart:

Count 4 10 min chart:

Count 5 10 min chart:

You can see that on all the Counts we are at resistance. For Count 1, this may only be a temporary stopping point. For the other Counts it may be more likely to halt the retracement, but let's see.

 

16:07 BST SPX Update

The moves up from 1010.91 can be counted in various ways: a single zig zag, a double zig zag or the start of an impulse. Taking out 1032.95 negated the completed double zig zag count from Friday, but these other possibilities remain valid.

Here's the single zig zag and the alternative (1), (2) count on a 1 min chart:

I've marked wave [C] as complete, but its quite possible there's another high to come. Wave [C] is about 1.618 x wave [A] on my labelling.

If we're in a single zig zag, then if we made 5 waves down from 1131.23 to 1010.91 (see Count 1 on the chart of Option 1 from Friday night), we're probably going to see an X wave here before another zig zag up to achieve a deeper retracement for wave ii. 

If we're in a 4th wave (see the chart of Option 2 or Option 5) , this single zig zag may well be the whole of the retracement. 

If we're in a 2nd wave but only retracing the decline from 1082.60 (see Option 4), this retracement (nearly 50%) may be enough to complete it).

And here's the double zig zag on a 1 min chart:

It shows a further high required, but could be complete at today's high. If this count is correct, then its likely we are only in a 4th wave retracement (see Options 2 and 5) or the 2nd wave retracing only the decline from 1082.60 (see Option 5).

13:58 BST - ES Update

Futures made a new low below the 1 July lows overnight. However, from Friday's high to the new low looks more like 3 waves rather than 5, so it may still be part of an on-going 4th wave corretion (or 2nd wave - see the SPX update from Friday night) rather than  a 5th wave down:

ES 5 min:

On the above chart, which is the nested ones and twos  count (Count 5) I've shown either a completed 4th wave at Friday's high, or, the 4th wave still in progress. The latter may seem more likely at this stage. If it takes out Friday's high, then it will become the main labelling for this count.