Look, there is going to be big market bounces. Squiggle charting is more an art than a science. However, the overarching theme is that social mood - in fact global social mood - is turning down in a huge wave. The stock market reflects this mood and is its barometer. Thats EW theory in a nutshell. Counting waves yes is nice, but ignore the underlying social mood foundation of EW theory and you will be lost over a long time. This is something that Prechter understands deeply and I concur with.
The real question is simple: Has long term social mood bottomed and destined to get lower than that in 2008? If you answer that social mood is likely to deteriorate worse than 2008 then you can be reasonably certain that in time, the market will follow suit the downturn of mood. That has been my stance since I founded this blog. And I think you can all agree social mood - nature's forces at work - has not bottomed long term.
[Update 10:23PM: Netflix. ED pattern. This chart has been on my public page for a while.
[Update 8:15PM: In conjunction with this chart, and this chart, the stock bond ratio just hit epic proportions and surpassing the crash of 2008. Amazing considering we are officially 100% debt to GDP ratio. Via the excellent Sentiment Trader.
The other night I suggested this chart that serves as a basic guide if this is a wave [iii] down.
Now we are realizing a reach toward Fibonacci 1.618 x [i].
Squiggles don't yet seem "done"
True panic selling today and the 60 minute chart above shows the down pressure and decliners.
30 year bond prices have thrusted and squeezed more violently than I had anticipated. But looking at prices over the last few years, this has been the pattern.