Selling takes no vacation!
At any rate, we can see the 990-993 Minute [i] minimum target looks good as it aligns with the larger H&S neckline using the April peak.
The primary count has that today's gap down as the third of a third middle of Minute [i] of Minor 3. In theory, it would be best if this virgin wave blue box area remained untouched until Minute [ii]. Using a Fib marker and placing it roughly in the middle of this virgin wave space, this projects Minute [i] low of just under 1000 SPX, perhaps the 993 area.
Certainly the opening was extremely one sided and after the housing report the down volume ratio jumped to over 70:1. Yet by end of day, things didn't look so gloomy. I suppose thats the result of the low-volume dog days of August. Yet we have lower lows. EWI would call this "stair-stepping" down. And Minute [i] is the logical wave for that to happen.
So in the end, the market closed under pivot support of 1056 and broke under the sloping H&S neckline. The rebound today can certainly be seen to be "backtesting" the neckline.
Again, we'll just throw the count up there and see what happens. Ironically the contrarian play is that the H&S plays out to its target to the downside. (Thats about how much respect H&S patterns get anymore)We may need to adjust some subwaves depending on what happens.
30 Minute view:
The top (bullish) alternate is pattern of repeating fractals on smaller scale resulting in a complex wave (ii) - (or even [ii] if it turns out that way). This is a count I dreamed up on the way home tonight. If the gap down solidly closes, I'll be looking at this possibility.
Why if the gap down closes? Well the gap down today is supposed to be a breakaway gap. It started to breakaway but buyers gave the market some decent support after the housing report spasmodic thrust down which vaguely had the look of an exhaustion sell spike. (But perhaps it was just exhaustion on the day only)
Basically this is an idea of bulls taking the bears best shot and still standing. Breakaway gaps shouldn't be closing the day after it is created. Hence it wouldn't be a breakaway...
But the gap down today must close first, and until that happens, this is just a "gee-whiz" thing. The only reason I thought of it is because if its going to happen, this would be the spot with 8 low volume trading days left in the summer before post-Labor day volume comes back.