If the rally off 11/25 is to be considered impulsive, it must consist of at least 5, 9 or 13 waves. A wave count of 7 or11 means the structure is corrective. I think there should be no doubt that the rally is impulsive. So with that let's assume the market wants to put in 13 waves until proven otherwise.
Last week I based my call on the choppiness of the move down. Here is a link to the 1 min chart I posted at EOD Friday highlighting my concerns, which proved to be correct.
Based on my 10 min option 1 chart below there is a very strong case for the completion of the impulse wave up. However, when drilling down the squiggles at the 1 min level, the case for a 13 wave extended impulse up is still pretty strong.
So for tomorrowI believe there may be room for one more rally higher based on the 1 min squiggle count below.
1262.52 will be the key. Should the market bounce back above this level, we can confirm that the pullback today was a three wave correction and a 13th wave up will be in the works.
However, if 1 more low is made below today's 1250.07 low before taking out 1262.52, there is a good case a five wave impulse down has completed. This will also confirm the 60 min MACD -ve divergence. If that happens, I will be looking for a deeper retrace down towards the 20 day SMA at 1226 for wave (b) of [y].
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| Option 1 - 10 min |
Let's see if the bears can put in a new low below 1250.07 before the bulls rally the market back over 1262.52. This will help confirm which option is correct.
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| 1 Min |
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| 13 |
