Something Is Missing - Market Analysis for May 4th, 2026

In the weekend update, I outlined my expectation for us to be working on waves (iv)(v) early this week.   As of my writing this update, both the SPX and ES have seen overlap into wave (i), which is most common in diagonal structures.  Therefore, both can be considered complete in their wave (iv) pullback.

The issue with diagonals is that all substructures are 3-waves.  So, any rally off a wave (iv) potential low would usually look indistinguishable from a corrective rally, as both would be 3-wave structures.  So, it is certainly well within reason to assume wave (iv) is done now that we have seen the usual overlap.  But, there is no way to tell from a high probability perspective.

As the title notes, something is missing in this structure. And, it is that higher high for wave (v).   And, again, keep in mind that the rally for wave (v) will take shape as an a-b-c structure, so it could take us a couple of days to complete.

So, as long as we hold today’s intra-day low, I think it is reasonable to look higher for wave (v).  But, even if we do see one more lower low, this chart is really incomplete, as we really should see one more wave for wave (v) in the coming days.

Lastly, please remember that this discussion above is about the micro structure.  The bigger degree structure is still something of which you must be aware, and that was covered in the discussion and link in the weekend update.