(c) Wave Follow Through

Last night, I said that the ideal target for wave 1 down in the yellow (c) wave would be 1613ES.  Well, last night, the market bottomed in wave 1 of the (c) wave at 1613ES.  However, wave 2 barely even gave us a .236 retracement, which was completely unexpected, and not something  for which one is able to reasonably plan.   Yet, the market now seems to be following through on the 3rd wave down, and will hopefully abide by Fibonacci Pinball to give us good guidance on this decline.

For today, we seem to be in the heart of wave 3, and have just about completed wave iii of 3.  This means we should expect a bounce in wave iv of 3, which should take us up to the .764-.618 extension region between 1591 and 1597ES.  From that region, as long as we stay below 1599ES, we will be targeting the 1569ES region at a minimum, with the ideal target of 1560ES at the 1.618 extension, and potentially as low as the 1555ES or 1546ES regions, if the market has designs on much deeper targets.

In fact, the only real overlap target I have for this decline is the 2.618 extension which lines up with the (c)=1.382 *(a) calculation in the 1523/1524ES region.   This could very well be our target, which means that wave v of 3 should extend to the 1546-1555ES region, and that may occur quite quickly.  Remember that even though wave iii of 3 is usually the strongest technically, wave v of 3 is often the longest.  So, this would make complete sense if we were to see this, as early as tomorrow.

For tonight, please watch your overhead Fibonacci resistance levels, because any more over 1597ES would tell us something else unexpected is playing out.  But, for now, this is developing quite well as an impulsive (c) wave down.

 Elliott Wave Chart