The purple channel line is what I estimate to be the Grand Supercycle wave channel from approximately 1780 onward. Grand Supercycle wave [III] consists of 5 Supercycle waves. The last Supercycle wave (v) lasted from the 1932 low to an "overthrow" top in 2000.
The 2007 rise was an expanded flat cycle "b" wave and now we should be in cycle wave "c" of Supercycle wave (a) down. Cycle wave "c" should consist of 5 Primary waves down. The count is that we just started Primary 3 down which should be the most destructive wave.
The DOW briefly recently captured above the purple channel line. Notice how the Dow was driven under this channel line on a big fat 90% red candle down day.
Its pretty simple. I propose a failure to capture above the channel line will result in a move to the lower channel line just like any simple 5 wave move and correction at any degree. The lower channel of course resides very low. In fact, since the "overthrow" of the upper channel was so dramatic, its speculated that the DOW will "underthrow" the lower purple channel which will result in a DOW of less than 1000.
Ultimate low of less than 400 is what Prechter is predicting. (price range of the previous sub wave 4 which is 1929 high)
I'll just say that I'll start with a target of the purple channel line first and then lets see. After all DOW 1300 is pretty low yes?
PS - Also note that the DOW touched the blue 7 month uptrend low today on a bit of a "hammer" candle (perhaps) and maybe Monday will continue a wave (iv) bounce.