Lower target for wave 5 of the larger 3 is somewhat conservative. It certainly could go lower. This subwave 5 down should complete over the next day and a half. If the Fed Chairman Powell throws the market a bone when he speaks on Friday morning, we'll probably see the relief rally back up for the larger Wave 4. That might be a good time to go long for a little while as the SPX could climb as high as 2580 before our next leg down to complete this initial larger degree A-B-C correction.
Toward the end of trading on 1/3 I closed my shorts because SPX did not fall nearly as hard as I had expected, and I did not want to hold these positions on Friday knowing Powell was expected to speak that day. There was no way that he was going to say that in the face off all the concern about the economy that rates were guaranteed to go up this year, so the markets were clearly going to interpret just about anything he said as positive (they all want interest free money...pining the days of quantitative easing). The ending 5th wave diagonal was confirmation that we could expect a significant move up today, 1/4/2019.
Today, I opened a new short position after the NASDAQ had risen over 4%. As the NASDAQ cleared 4% gain on the day, it and the other indexes were entering a 5th wave diagonal. I expect Monday, 1/7/2019, SPX should drop before we get a move up that should top out somewhere shy of 2580 (2560 to 2580). Then, we should start wave 5 down. I'm looking for this wave to move to between 2330 and 2280. Perhaps this will coincide with possible breakdown of the recently announced trade talks with China scheduled for early next week.
In wave 3, wave "2" was short and sharp, so wave "iv" is likely to be long and flat. If the target is 1.618 then the PT is the 2329/2339 area for "v". 0.382 upwards from that target is 2460. So very likely we are in a sideways trinagle "iv" or a flat which will end at 2460 prior to the wave "v" decline to the 2329/2339 area.