Movement above 1,908.93 was not expected. I have reanalysed recent movement and the wave count has changed.
Summary: Upwards movement is incomplete. The target is at 1,939.
This analysis is published about 07:33 p.m. EST. Click on charts to enlarge.
The aqua blue trend lines are critical. Draw the first trend line from the low of 1,158.66 on 25th November, 2011 to the next swing low at 1,266.74 on 4th June, 2012. Create a parallel copy and place it on the low at 1,560.33 on 24th June, 2013. While price remains above the lower of these two aqua blue trend lines we must assume the trend remains upwards. This is the main reason for the bullish wave count being my main wave count.
Bullish Wave Count.
In trying to see what I had wrong with the wave count, and the cause for the invalidation, I have gone back to the weekly chart.
I am confident of my labeling of minor waves 1, 2, 3 and 4 within intermediate wave (1). I would not want to see minor wave 3 as ending anywhere other than at 1,729.86. Here minor wave 3 is just 0.76 points longer than 2.618 the length of minor wave 1, and considering the length and duration of these waves this is an exceptionally good Fibonacci ratio. The subdivisions within minor wave 3 are perfect.
Minor wave 5 must begin at 1,646.47 as labeled. It may be either an ending diagonal or an impulse. So far an ending diagonal looks most likely, particularly considering the structure of minute wave iii within it; on the daily chart this movement looks very strongly like a zigzag.
My conclusion is that minor wave 5 must be incomplete, and will continue higher to end either at or slightly above the pink i-iii trend line of this contracting diagonal. That is the most common place for ending contracting diagonals to end because they rarely fall short of the 1-3 trend line.
This bullish wave count expects a cycle degree correction was over at 666.79 for a fourth wave, and a new cycle degree bull market began there for a fifth wave. Within cycle wave V primary waves 1 and 2 are complete. Within primary wave 3 intermediate wave (1) is almost complete.
Minor wave 5 is an almost complete ending contracting diagonal. Within an ending diagonal all the subwaves must be single zigzags, and the fourth wave should overlap first wave price territory.
Within the final fifth wave of this diagonal minuette wave (b) is a running contracting triangle. Minuette wave (c) is an incomplete impulse.
I would expect the final fifth wave of this diagonal to end at the upper i-iii trend line, or maybe to overshoot this trend line.
The diagonal is contracting because minute wave iii is shorter than minute wave i. Minute wave v may not be longer than equality with minute wave iii at 1,973.72 because a third wave may never be the shortest wave.
At 1,939 minuette wave (c) would reach equality with minuette wave (a).
Within minuette wave (c) the third wave may have just ended during Tuesday’s session. It has no adequate Fibonacci ratio to subminuette wave i.
I have used Elliott’s first technique to draw a parallel channel about minuette wave (c): draw the first trend line from the highs of subminuette waves i to iii, then place a parallel copy upon the low of subminuette wave ii. I will expect subminuette wave iv to begin with a little downwards movement tomorrow and most likely find support at the lower edge of this channel. Subminuette wave v is most likely to end either midway within the channel, or to find resistance at the upper edge.
I will expect upwards movement to end either at the pink i-iii trend line of the diagonal, or to overshoot this trend line most likely.
Tomorrow when markets open subminuette wave iv may not move into subminuette wave i price territory. This wave count is invalidated with movement below 1,886.06.
Bearish Alternate Wave Count.
This bearish alternate wave count expects that the correction is not over. The flat correction which ended at 666.79 was only cycle wave a of a larger super cycle second wave correction.
Cycle wave b is now longer than the maximum common length of 138% for a B wave of a flat correction.
Cycle wave b is an almost complete zigzag structure.
A clear breach of the large maroon – – – channel on the monthly and weekly charts is required for confirmation of this wave count. If that happens then this would be my main wave count and would be strongly favoured. Only once this wave count is confirmed will I calculate downwards targets for cycle wave c for you; it would be premature to do that prior to confirmation.