There are clear positive divergences on the daily tick and McClellan's. And after two 90% down days this week, stocks will probably find some near term support at 918 - 927 [EDIT: 1027-1030 seems like decent support] or somewhere in there. The volume and advancers ratio may need a breather.
But dip buyer beware, there has been a trend change so predicting temp bottoms is more an art than science. P1 proved that mightily.
I didn't know there was an FOMC meeting next week until I read it on EWI's site. It makes sense the decline performs a relief rally for a few days and again allows oversold conditions to work itself out and consolidate for the next big wave [iii] leg down.
In addition, after taking 8-9 days to complete Minute [i] (if thats what it is) a 3-5 day relief rally for a Minute [ii] would certainly be within the realm of normal.
I used the Wilshire 5000 to get a better read on the subwaves. I made some slight adjustments but I think it works kind of nice. I remade the wave (iii) internals and was amazed at how they connected on trendlines so it could be correct.
I had to change the pink (ii) to a flat to satisfy the guidelines of alternation. Its not going to work on each secondary index as well but thats not important. The Wilshire makes the best waves, its 5000 stocks...
I am assuming some early Monday weakness followed by another relief rally for Minute wave [ii] , this one likely more muted in strength and breadth and taking longer than 1 day. 50% or more Fib is the target.