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Yesterday’s analysis expected price to move lower to complete a fourth wave correction. This is not what happened. Price moved higher indicating the correction had already been over.

The wave count is mostly the same. Targets are the same and can now be calculated at multiple wave degrees for higher probability.

Click on the charts below to enlarge.

S&P 500 daily 2013

The structure is within the second zigzag of a double labeled primary wave Y. Within this second zigzag intermediate wave (C) is most likely incomplete.

Within intermediate wave (C) minor waves 1 through to 4 are most likely complete. We may use Elliott’s channeling technique to draw a channel about the impulse of intermediate wave (C). Draw the first trend line from the lows of minor waves 2 to 4, then place a parallel copy upon the high of minor wave 3. At this stage it looks like minor wave 5 may end about the upper edge of this channel.

At 1,573 cycle wave b would reach 105% the length of cycle wave a. This is the minimum requirement for a B wave in relation to an A wave within an expanded flat, and as expanded flats are the most common type of flat this price point has a good probability of being reached.

Also at 1,573 minute wave v within minor wave 5 would reach 0.618 the length of minute wave i.

At 1,575 minor wave 5 would reach 0.618 the length of minor wave 3.

If price continues to move higher through the first target then we may use the second target. At 1,589 minute wave v within minor wave 5 would reach equality in length with minute wave i. At 1,590 intermediate wave (C) would reach 0.618 the length of intermediate wave (A). At 1,591 minor wave 5 would reach 1.618 the length of minor wave 1. This gives us a high probability two point target based upon three wave degrees.

Within intermediate wave (C) minor wave 4 may not move into minor wave 1 price territory. This wave count is invalidated with movement below 1,409.16.

Within intermediate wave (C) minor wave 1 has no Fibonacci duration lasting 4 days, minor wave 2 lasted a Fibonacci 3 days, minor wave 3 lasted a Fibonacci 55 days, and minor wave 4 lasted a Fibonacci 5 days. So far minor wave 5 has lasted 12 days and is incomplete. A possible end may be at a Fibonacci 21 days which will be in another 9 sessions. If it does not end there then a further 13 sessions would take it to a Fibonacci 34. At each Fibonacci time duration I will look at the structure to see if it could be complete and if so we shall have an alternate wave count for that possibility.

At intermediate degree wave (C) has so far lasted 79 sessions. In another 10 sessions it will have lasted a Fibonacci 89.

The most likely end to this trend may be 27th March, 2013 (give or take one day either side). However, Fibonacci time relationships are not always reliable. This is a guideline only.

S&P 500 hourly 2013

Upwards movement was not what we expected for Thursday’s session and is unlikely to be a continuation of minute wave iv. Minute wave iv must be over already as a brief and very shallow zigzag lasting just 4 hours.

Minute wave v has begun and within it minuette wave (i) may already be complete.

Within minuette wave (i) subminuette wave iii is just 0.07 longer than 2.618 the length of subminuette wave i. If subminuette wave v moves higher to 1,564.52 it would reach equality with subminuette wave i.

When minuette wave (i) is complete then we should expect a correction for minuette wave (ii) to be relatively deep. Minuette wave (ii) may not move beyond the start of minuette wave (i). This wave count is invalidated at minuette wave degree with movement below 1,548.24.

When minuette wave (ii) is a complete three wave structure as viewed on the five minute chart then we should expect a small third wave upwards to make new highs. I would expect minuette wave (ii) to be over within a very few hours and so we may see it end tomorrow and minuette wave (iii) may begin.

If the wave count is invalidated with downwards movement then I would consider the unlikely possibility that minute wave iv is not over and the invalidation point would move back down to the high of minute wave i at 1,525.34.