And then we updated on 20 September to say the potential was still there for a triangle, but, we said it was still only a potential and would have to form properly in every aspect. And, as you likely surmised by now - given the Fed meeting, it did not. Therefore, we now have the situation where, "most likely" we made the C wave at the lows, and the possibility of new highs gathers more evidence. The chart that shows this the best is the ES 4-hr chart, but it agrees with the hourly cash S&P500, so we see no conflict.
|ES 4-hr Chart - New Highs Gather more Evidence|
We also have the situation where wave (2) downward of a potential contracting ending diagonal on the three-day DOW overlapped with wave A, but this did not happen in the S&P500. That's OK for the S&P500. In a contracting ending diagonal, the only overlap requirement is that wave (4) overlap with wave (1). So, that may help clarify where we are in the count: if it's a contracting ending diagonal, then any marginal new highs would be wave (3), provided they form as a zigzag.
If we are in the impulse count, up, then wave iii of 3 makes sense. And again, we have absolutely no preference as to which forms. We will need to study divergences with the advance / decline line as they become available and see what makes sense at the time.