Yesterday’s main wave count expected more upwards movement towards a short term target at 1,668 to 1,671. Price did move higher, but fell well short of the target before turning to move sideways.

The wave count remains the same. At this stage the main and alternate wave counts diverge.

Click on the charts below to enlarge.

Main Wave Count.

This wave count agrees with MACD and has some nice Fibonacci ratios in price and Fibonacci relationships in time.

Minor wave 3 is 15.1 points longer than 2.618 the length of minor wave 1.

Ratios within minor wave 3 are: there is no Fibonacci ratio between minute waves iii and i, and minute wave v is 5.44 points longer than equality with minute wave iii.

At 1,740 intermediate wave (C) would reach equality with intermediate wave (A). At 1,739 minor wave 5 would reach 0.618 the length of minor wave 3.

Within minor wave 5 minute wave ii may not move beyond the start of minute wave i. This wave count is invalidated with movement below 1,560.33.

Minor wave 1 lasted a Fibonacci 21 days, minor wave 2 lasted a Fibonacci 8 days, minor wave 3 has no Fibonacci duration at 98 days, and minor wave 4 lasted 22 days, just one day longer than a Fibonacci 21.

Minor wave 5 may not exhibit a Fibonacci time relationship. The next possibility may be the 29th of October (give or take two days either side of this date) where minor wave 5 would have lasted a Fibonacci 89 days.

Keep drawing the wider parallel channels from the monthly chart and copy them over to the daily chart.

Upwards movement completed a five wave impulse for subminuette wave iii. Subminuette wave iii is just 2.38 points longer than equality with subminuette wave i.

Ratios within subminuette wave iii are: micro wave 3 has no Fibonacci ratio to micro wave 1, and micro wave 5 is just 0.13 longer than equality with micro wave 1.

At 1,670 subminuette wave v would reach 0.618 the length of subminuette wave iii. If price keeps rising through this first target then the next target is at 1,678 where subminuette wave v would reach equality with subminuette wave i.

When minuette wave (i) is a completed five wave structure we must move the invalidation point down to its start at 1,628.05 and expect a deep second wave correction.

If subminuette wave iv moves lower tomorrow it may not move into subminuette wave i price territory. This wave count is invalidated in the short term with movement below 1,651.35.

The target for minute wave iii remains the same. At 1,720 it would reach 0.618 the length of minute wave i.

If we see movement below 1,651.35 tomorrow then it may be possible that minuette wave (i) is unfolding as a leading diagonal with the first wave a zigzag. This is possible, but this structure has a lower probability. Leading diagonals are not as common as impulses in a first wave position.

Alternate Wave Count.

While price remains below 1,709.67 it will remain possible that we have recently seen a trend change at cycle degree. However, we should always assume the trend remains the same until proven otherwise.

This is a huge trend change. The new downwards trend should last from one to several years and take price substantially below 666.76. We need some confirmation before having confidence in this wave count.

We should assume the trend is upwards until this wave count is confirmed with movement below 1,560.33, and then with a breach of the black parallel channel on the daily chart.

This wave count is the same as the main wave count, except the degree of labeling in the final upwards wave of minor wave 5 is moved up one degree.

The structure for minute wave ii is now a completed double zigzag and is just over the 0.382 Fibonacci ratio of minute wave i.

This alternate wave count expects more downwards movement tomorrow as a third wave downwards begins. If we see movement below 1,651.35 this wave count will slightly increase in probability. It does not finally invalidate the main wave count though, so this would still remain an alternate.

At 1,526 minute wave iii would reach 1.618 the length of minute wave i.

I will allow for the possibility that minute wave ii may not yet be over and could continue higher as a flat or very rare triple. I am allowing for this possibility because at just over 0.382 of minute wave i, this second wave is a shallow correction and second waves are more commonly deeper than this.

If we move the degree of labeling within minute wave ii down one degree this may only be minuette wave (a) within a flat correction. This would require downwards movement to 1,630.64 at minimum as minuette wave (b) must be 90% of minuette wave (a) for a flat. Thereafter, minuette wave (c) should move above 1,659.17.

There is another possibility. Minute wave ii may be a flat correction with minuette wave (a) complete at 1,646.61–the high labeled minuette wave (w), minuette wave (b) complete at 1,628.05–the low labeled minuette wave (x), and minuette wave (c) may be unfolding upwards as a five wave impulse which would be incomplete. This alternate possibility does not diverge from the main wave count for some time yet.