[c] Wave Not Dead Yet

As I have been highlighting this week, the nature of the next drop is what will likely provide for us strong indications as to whether the market has yet completed its wave [2], or if we have a [c] wave decline to come to complete its wave [2].  

With today’s decline off the all-time high, we have what can count as a 5-wave micro structure.  While that can still be an a-wave for the yellow wave iv, we will need to see the market complete 5 waves down towards the 3800/20SPX region to fill in a solid 5-wave structure for wave 1 of the [c] wave down.

But, that means that anything less than that will have us move towards the yellow count.  So, should the market now make a higher high, I would have to view that as completing wave 1, as currently presented in yellow.  Moreover, should the market only complete 3-waves down into the support region below, then that would be counted as wave iv of wave 1, and we would then have to view wave [2] as completed, and prepare for wave 3 of [3] to take hold in the coming weeks.

So, as it stands right now, if we are indeed going to still see a [c] wave down towards the 3600SPX region, then we will need to complete 5-waves down towards the 3800-20SPX region.   Anything less than that, or if we should make a higher high, then we will have to prepare for wave 3 of [3] sooner rather than later.