How Much Lower Are We Going?
We gave this market every opportunity to prove it wanted another high. But, when 1795ES broke, there were no more questions.
So, the question is not if we go lower now, it is how much lower. Even in the more bullish wave 4 scenario, we need a completed 5 wave structure. So far, all we have is wave iii of this move off the last top just about complete.
Technically, we know that wave iii of (3) will target the 1.00 extension, and in a strong move, the 1.236 extension. Here, the 1.00 extension is the 1777ES region. Assuming we do not break it, then I expect a bounce to the .618 extension in the 1790 region before heading below the 1777ES region.’
Based upon how we follow through to the downside over the next few days, we will have to make a determination if we are completing a larger 4th wave or something more sinister is playing out. We do not have enough information yet to make that determination. So, stay tuned. But lower will still likely be seen as long as we remain below 1793ES.