Still in Search of a Standard b-Wave

While the current count has the bottom to the a-wave/alt-ii in place, the market has a micro count now that can take us a bit lower in the SPX, which would then cause me to move that bottoming over.

However, if we hold this low, and rally strongly, then I will still maintain the current count as shown.

Ultimately, there are two things I want to point out.  First, while it is certainly “possible” that the rally seen on Monday was all of the b-wave, I think it is unlikely when we had an a-wave that took us a month. So, based upon the proportionality we “usually” see in the markets, I am going to expect a b-wave rally to our target region at one point or another.

The second point I want to make is that I believe that levels under 2100 will likely be seen, as shown on my primary count.  While I may be convinced that this drop is all of wave ii, I would need to see a clear 5 wave rally off these lows to make me a believer (as shown in the blue count alt 1 overhead).  Along those lines, please take note that the MACD on the daily IWM chart is approaching the target we set a while back. 

So, my primary expectations remain that lower levels will be seen over the coming weeks, but please do not be rigid, especially in light of a potential 3rd wave set up to higher levels.

1turnchart
1turnchart
IWMdaily
IWMdaily
Avi Gilburt is founder of ElliottWaveTrader.net.