The prior low for my bigger A wave down was taken out yesterday, so that means the bigger B wave up finished at Tuesdays high. It did not subdivide into a smaller ABC up. We should now be in the bigger C wave now, which should unfold in 5 waves. Yesterdays drop was the smaller wave 1, which will be followed by a smaller wave 2 bounce. This could all complete by the end of this month.
The daily chart on the RSI is working its' way lower and could reach oversold in a week. If it does then I'd have to lean toward an early rally up in the first few days of August that fails to make a new high. Then a pullback into the second week for a higher low, which would make an inverted head and shoulders pattern and be very bullish for another higher high into September.
That's my "lean" but I could be wrong of course. The clue will be to see how the coming low finishes. If it's a clean ABC, and the technicals on the weekly look like we could have another higher high, then I'll stick with my lean. But if we end this move down in 5 waves I'll then have to consider that it's just one bigger A wave and that we'll only make a lower high with the rally back up into August/September.
If that happens we'll see an even larger move down to follow for a much bigger C wave. It would then re-open the door for those 2 FP's on the SPY from the Yahoo to be the target low. We'll have to keep a close eye on how the coming low unfolds as that will give us the clues.
As for today, we could bounce late into it, or sometime Friday. But I don't think it's finished yet. "Time" is the important then here, not the price. So "time wise" I think it's going to be next week before we see a bottom. We could see it Sunday/Monday but it could be revisited late in the week after a mid-week rally fails to hold. The end of the month is where many bigger "turns" happen.
Meaning that if we get a low on Sunday/Monday, and start a strong rally back up, it would either be a wave 1 or A wave, which late in the week will be followed by a wave 2 or B wave down. That one could revisit whatever low we get in the next few days. My thoughts on it still suggest the rising green trendline.
Have a blessed day.
