On Friday, the market completed a 5 wave sequence from 1396.56, at 1437.80. After opening slightly higher today, the market moved lower to 1435, and the rose to a new uptrend high at 1438.74. This completed another 5 wave sequence from the 1396.56 low, and most likely marked the end of the 5 wave sequence from 1467. After the new high, the market moved lower, dropping to 1435.54, and then tried to move higher, but stalled at 1437.48. Once the market dropped below 1435 once again, the selling increased, dropping the market to the low of the day at 1429. Today’s move lower unfolded in a series of 5 wave sequences with diminishing wave lengths, which generally means the end of that move is imminent.
It is quite possible that the move to 1429 completed the corrective move, and if the market can move above 1430, we should see a fairly sharp rally. If we see anything other than slightly lower lows, this correction could have further to go. Support is at 1426, and if that level doesn’t hold, 1387-1397 is the next level of support.
If the market can rally to new highs, the move to 1497 may be underway.
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