Unfinished Business - Market Analysis for Mar 16th, 2026

With the futures not making any lower lows yet, and understanding that a truncated ending diagonal is a rare occurrence, the greater probability seems to suggest that there is another lower low sitting out there for the ES, and hence, the SPX potentially as well.  

So, due to the size of today’s bounce, I am assuming that we are now within the b-wave bounce within the 5^th wave of the ending diagonal that is taking shape for the c-wave of the larger degree (a) wave off the recent market highs (you can see the count clearer on the smaller degree charts).  That suggests that we have yet to begin the c-wave, which should take us to a lower low to complete this ending diagonal.

I have also seen a number of people already turning bullish on this drop expecting another major rally to take shape.  But, I want to remind you that we have to focus on what is most probable rather than what is simply possible.  While it is certainly possible that we are bottoming in all of the pullback we are going to see, I want to remind you that we have not even struck the .236 retracement of the rally off the April low.  In my humble opinion, it is not probable that such a very shallow retracement is going to be all we see.  Again, it is certainly possible, but I cannot view it as probable.

So, it leaves me with two reasonable expectations.  The first is the expectation for one more lower low before this diagonal is complete, as it is quite rare to see a truncated ending diagonal and that is what we would have to consider if the low is in place now for the (a) wave in the futures chart.  The second  expectation is for a rally to begin when the (a) wave completes, but viewing it as only a corrective (b) wave for now, which should set up another decline to AT LEAST the .382 retracement of the rally off the April low.

And, as the title suggests, it seems that it is probable that we have unfinished business to the downside.