As of this morning’s gap up again, we now have a minimal structure to consider the market has rallied 5-waves up off last week’s low, and clearly earlier than I had expected this strength. So, what does this 5-wave rally represent?
As we know, if all of wave [ii] is already completed at the .236 shallow retracement, then this 5 wave rally is either all of wave  of [iii], or may even be only the wave i of wave  of [iii], which is hinted to in the dark green count on the 60-minute chart. (In the dark green count, it would mean that a 5-wave rally to the 4000 region will be wave  of [iii], which would likely make wave  of [iii] point us to the 5000 region which would be the 1.236 extension of waves [i] and [ii]). I will discuss this in greater detail in the weekend update.
But, our alternative perspective is that this 5-wave rally is a [c] wave in a bigger b-wave within wave [ii], as shown in yellow. And, when we are in a bull market, I have to give the edge to the bulls when I determine which is the primary count – even though I would really prefer to see a reasonable wave [ii] retracement.
So, how do we make a determination as to which is truly the highest probability? Well, once this rally tops out, and we break back below the micro wave 4 of this wave  (as outlined on the 5-minute SPX chart), we will see how the retracement takes shape. If we are CLEARLY corrective in nature, then it solidifies an expectation to begin the heart of wave [iii] sooner than I had initially expected. However, if the next decline is CLEARLY impulsive, and we break below the wave  support box on the 5-minute SPX chart, then it again opens that door to the 3050-3150SPX region for a more appropriate wave [ii].
In the meantime, as long as we hold 3497SPX, then the market has potential to extend within this 5th wave of wave . Below that level is the initial signal that wave  has potentially topped.
As I said yesterday, the battle lines are drawn. Yet, it is only a matter of time before we will break out in a major bull market move as we head into 2021. And, I think the next two weeks will set our pattern for all of 2021.