Its hard to argue the structure that has developed from the SPX 930 top a few weeks ago. We had a double three corrective down to 878, a sharp zig zag (with a weak C leg) back up to 924 and a beautiful 5 wave move down back to where the B wave started. That qualifies as a 3-3-5 flat pattern. And now there may be a nice bounce from that support.
Question is, at what degree of trend? Was today the end of the Red Intermediate (X) wave? Will now the market get bullish again and rally above 950 toward 1000 possibly? I cannot rule anything out but I still think its lower probability at this point. A topping pattern happened at 930SPX. An apparent corrective "X" wave occurred in the form of a flat back to key breakout support 878 (twice). Question also is: Is the corrective over already?
I re-labeled my degree of trends and will speculate that a "double three" (X) wave at Intermediate degree MAY be playing out. The first corrective in the double three ended today in the form of a 3-3-5 flat for Minor wave W. The subsequent "connecting" wave usualy takes the form of a 5-3-5 zig zag and that means an upwards move to Minor X. After the Minor X wave peak, the last corrective could be another flat, another zig zag down or a triangle.
But that is getting too far ahead of things. For now, I am looking for a correction upward and a bullish one would not surprise me, in fact it would almost be required for this type of corrective pattern. How high can this Minor X wave go up and still be considered an X wave and not some kind of new ABC move higher? Well I would think a return to the 920's or even low 930's is acceptable. There is no hard rule . See Figure 1-45 through 1-48 in Elliott Wave Principle. This was my inspiration.
I think he bulls bought the dip once again.