[Update 2:55PM: Possible count for the SPX. 1097.5 is a key level for this count. Notice where the RSI peaks in wave [a] which is a subwave iii of (iii). For now, I'll assume today's RSI peak was a subwave iii of (iii) also. We'll see how it goes.]
[Update 10:25 AM: Everything is playing out well. The still-skeptical market will turn bullish with continued price action upward. Question is, how much up will be required to "reset" sentiment to whatever the market needs it to be for a wave 2 peak? Leading Diagonals can retrace deeply and according to Prechter in EWP (10th edition) they often retrace a Fibonacci 78.6%. So mentally we must be prepared for DJIA 10900.
Also note the DJIA has gone past the 50% retrace mark so the Minor 2 works well as the proper wave labeling.
Now I wouldn't count that 78.6% retrace percentage for every index. The main index it could work on is the DJIA. This is of course Prechter's favorite index for wave structures (and is the best candidate for the supercycle expanded flat)
Technically if the SPX closes above the 200DMA, that will also get 'em bullish.
[Update 9:47 AM: Another view of the VIX and how its trying to hold above the gap up. The pattern looks distributive in nature and there is a good chance the gap will eventually fill or challenge to fill.]
Then last week I suggested that instead of a double ZZ, perhaps wave C will extend (which implies practically the same thing as a double ZZ - higher euro)
Now after the pattern has developed more, I think going back to a double ZZ pattern would indeed work better for now.
Stocks made a new recovery high Sunday in the futures.