The wave structure remains unclear, maybe abc for W or 12-12 structure note RSI stopped at 60
Potential bearish outlook for S&P 500 if impulsive down and break 1968
Possible wave count, it seems the larger degree correction is unfinished
Quote "an initial five-wave movement against the large trend is never the end of a correction, only part of it" (Elliott Wave Principle p.41) note wave (iii) travels about 1.618 of wave (i), wave (i) and wave (v) have equality in time and magnitude.
expect to see limited upside and a trend reversal to happen very soon. the index may give a little push between 4414-4420 then start to drop, if that's the case, will short once breach 4405
stop at 1 point below previous wave c or more conservative stop at 1 point below wave a
RSI divergence EMAs are silver see 4 hour chart below Indicator: CM Guppy EMA by ChrisModdy
both wave counts show potential bearish outlook, expecting abc correction or at least wave c of iv trading target 159.50 note RSI divergence
Current structure looks very promising retracement level within 0.382-0.5 range corrective wave a = wave c waiting for further confirmations eg. break wave b, break wave v , downward acceleration, etc potential risk wave abc = wave a
Although current rally breached the previous low of wave C-1 or (3)-1, we still cannot ruin the possibility of 4th wave correction as this can be a complex corrective structure eg. triangle as long as the end of 4th wave did not touch the wave 1, further downside could happen. alt count can be 12-12, or wave 4 of an expanding ending diagonal for wave C
I am inclined to assume the recent structure is a 3-wave zigzag note wave a circle = wave c circle Expecting a 3-wave or 5-wave structure at the same degree is happening
Could not find any clear evidence that suggest the recent movements are motive waves (impulse or diagonal). The structure looks very corrective so far, which may suggest further downside in the near future. The question is how far will it go once the correction is finish.