C Wave To The Downside Likely Underway
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After retracing over the past several days, today we moved lower and are testing the lower end of the next key pivot/support zone, which would confirm that we are indeed in wave (iii) of C down as part of the larger Ending Diagonal that we have been tracking for the past several weeks.
If we manage to break back under the 6672 level, that would further confirm that we are indeed in wave (iii) of C down as laid out per the white count on the ES chart. Further confirmation would come with a break back under the 6645 level, which represents the 100% extension of the initial move down off the highs.
If we see a corrective push back higher, the door still remains open to see a pullback for a wave (ii) of larger C, as shown in yellow. However, with the continued push lower this afternoon, it is looking more likely that we did indeed see a very shallow wave (ii) and are already in wave (iii) of C down. That said, until we actually break the support/pivot levels below, I will still allow for this yellow count for the time being.
Once we finally complete this larger ED to the downside, keep in mind that the reversal higher should be quite sharp. But in the meantime, as long as the action to the upside remains corrective in nature, it does look like we have some unfinished business to the downside before a meaningful bottom is found.
