Because of slightly lower lows today on both the DJIA and the S&P500, we have adjusted our count to show both the new triangle, and new diagonal possibilities.

New Triangle, Diagonal or Possibly Even Impulse 
We apologize in advance for the four potential counts, but the downward waves have gotten extremely ambiguous. We are not confused. We know how to handle each situation, but the 'count' is currently ambiguous. Both downward waves
can be counted either as
threes or
fives! Welcome to what we have termed,
The Fourth Wave Conundrum. But let's cover each count in detail, so you will be prepared as each count clears up.
We are showing the counts in
order of preference, but predictability has been lost  so it's just time to put our thinking caps on and pay attention to the details.
All Counts
At the location shown as circle red 2, we are not saying downward movement is entirely over. It very well may be, but additional downward movement to fill the gap at 2164 is possible. Or the gap may hold. So far, the gap has held, and the ES futures overlapped already upward in the after hours.
Triangle
Straight away because of the downward movement in today's wave, a barrier triangle from yesterday lost the "right look" at the previous location. A barrier triangle is still possible with a new lower trend line sketched in, as shown.
However, another possibility is that we are now making a "running triangle", instead. In a running triangle, waves 'd' & 'e' must 'converge', so if we don't go back to the top tomorrow, look for the possibility of a "running triangle" instead. Remember, in a running triangle, wave 'e'
must cross back down over wave 3. The running triangle count has its 'a' wave at the 2 Aug low, so today or tomorrow would finish the 'c' wave down in such a running triangle.
By contrast, the potential barrier triangle has to add a lot more waves yet.
Diagonal
If, on the other hand, if we pop slightly over the previous high tomorrow, then it is possible to be in wave 3 of a diagonal (shown as circle red 3). For the diagonal case, a new cash high
must be made. The problem with the diagonal is that flat waves are not allowed in diagonals, and if the ES futures higher high is included in the count, then there is a flat in the wave. So, the diagonal has
second priority. The key to this count is that only a
marginal new high is allowed, not a 20 or 30 point wave upward.
If wave 3 forms properly, then a wave 4 downward must overlap wave 1, downward, before wave 5 may begin higher.
Impulse
If you remember our previous post of 18 August, we said we had detected a completed diagonal at the point marked circle red 1 on the chart. We said it
could be ending or leading. We couldn't tell. And a leading diagonal there is
still possible. It doesn't
look like an
ending diagonal, yet because the downward price movement is not very extreme as expected when an ending diagonal is completed. But, a leading diagonal at that location is still possible, but it would seem very odd to get a Leading Diagonal near a market high.
The Dow came very close to a 61.8% retrace today, and that might be deep enough for a regular second wave with a powerful third wave to follow, depending on Chair Yellen's comments. But, given the overbought conditions and powerful divergences already, we rate this option as third in priority and probability.
Truncation
Because the futures did make a higher high on 23 August, it is possible to count a properly completed triangle in the futures  and then the higher high  which would result in a doubletop truncation for the cash market. This is our least preferred count because it kind of seems like a copout, but if we need to accept it, we will. But for this count, fierce downward movement should also currently be in evidence. And while we have made lower daily lows in the Dow, we have not even made lower daily lows in the S&P500.
Summary
The Fourth Wave Conundrum currently prevents a really good market prediction, but we can follow each option and systematically 'rule it in' or 'rule it out' of the current market count.
Best wishes as the choppy market continues. Remember to thank your local Federal Reserve for keeping everyone on pins and needles!