I would like to present a new “alternate” view on tonight’s update. The premise is that in the NQ the market remains in the process of tracing out a Minor wave 4. The preferred count remains that Minor wave 4 completed at the 14441 low on July 19th. The new “alternate” count suggests that minute wave ‘a’ of Minor 4 completed at the 14441 low. From there minute wave ‘b’ began to unfold and completed at Thursday’s 15084 high. This then suggests that off of last Thursday’s 15085 high minute wave ‘c’ began. The alternate view suggests that we are heading into a much steeper and deeper move lower. Support levels are included with Fibonacci extensions showing the potential for a drop below 14400 to occur before the larger advances take over. Below is the original update — and remains the preferred view until negated by the market. Both views remain active for now.
Monday’s trade was not very eventful. In fact the NQ remained in a “box” that started last week. Tuesday’s high and low are the initial boundaries. Last Thursday’s high at 15085 and Thursday’s low at 14811 gave us the lower boundary and the possible completion point for minute wave 4. If this is the case the rally to the globex high at 15056 was wave 1 of minute 5 and the pull back being wave 2 of minute 5. This then suggests that if wave 2 of minute 5 is complete a wave 3 advance should kick in. This also suggests we’ll see some acceleration to the upside with a quick break above 15086 and on up and over 15100. The alternate view would suggest we are still within a minute 4th wave correction. Waves ‘A’ and ‘B’ are complete with wave ‘C’ still unfolding off of the 15085 high. Remembering that all ‘C’ waves are 5 waves – I believe waves 1, 2 are complete and wave 3 is now underway. Wave 3 would need to accelerate to the downside to give stronger support to it being in force. This also suggests that once wave 3 of ‘c’ is complete a 4th wave bounce and a 5th wave decline would still be required to finish the minute wave 4 correction. Expectations would also remain for minute wave 5 to pick up the advance again with prices moving to new highs.