A Matter Of Extensions

Today, the market made a higher high, and may have completed all of wave iii.  But, in order to even begin confirmation of that potential, we need to see a break down below yesterday’s low, and preferably even below the overnight low made in the ES. 

However, with the micro structure seen today, the market may be leaving the door open for an extension in wave v of 5 of (v) of iii, as presented on the 5 minute chart.  That would suggest the market can still head up to 2486SPX, and even a bit beyond that region to the 2494SPX region, the next extension higher.

So, it’s now up to the market as to whether it wants to approach the 2500SPX region for wave iii alone, or if it will leave that for wave v business.  But, do remember that the alternative count has this move up as potentially ALL of wave (3), even though my primary count still would count best with one more iv-v.  Support for iv resides in the 2450-2455SPX region. So, it still can take us another week or two until this market tops out if waves iv and v take shape during that time.

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Avi Gilburt is founder of ElliottWaveTrader.net.