Primary Count: The Minor A wave of a 5-3-5 ABC zig zag up to P2 top peaked today just shy of 950. The waves for most of the day appeared to be B-type waves, a bunch of overlapping zig zags. It was clearly in corrective mode.
The e-minis show the channel starting to break which would support the notion of an A wave top. Also the wave [v] peak hit the mid-channel line which can be normal if the market is unable to produce a more bullish move.
The market is behaving like a bear rally zig zag to a peak. A robust initial move (breakout of the triangle) followed by a high altitude rope-a-dope bunch of overlapping correctives and eventually the last corrective wave will retrace to some B wave low (my target is 924-926) and then another 5 wave bullish move kicks and take the market past the resistance area that stopped the A wave on up to a rally wave peak.
B waves typically retrace 38% but not always. 926 SPX is the 38% retrace zone. The 200DMA also lies at 925. Gap support is at 923. Its a logical retrace area for a B wave.
Bullish daily sentiment is getting up there for equities and Kenny has an excellent post today that a bunch of markets are getting ready to turn sooner or later all at more or less the same time (commodities, Dollar, Euro, Gold & Silver, Bonds, equities).
So due to the way that it has all shaken out (the way all the markets are configured and sentiment), it may indeed be a P2 top or at least a significant rally high for the near and medium term. Its too early to tell which. However, if a 988 high sets in, in a double Intermediate zig zag move from 666, its a satisfying rally indeed. If 1000 is the "goal" the market has a way of tripping up that goal by about 10 points it seems. If I planned on selling at 1000, I suppose I'd be happy with 985-988!
You truly cannot call a P3 wave starting down until there is some supporting evidence along the way (wave patterns, selling volume, breadth, etc, fear, sentiment, etc.). But I am getting ahead of myself again.