Market Indexes: Major U.S. Equity Indexes closed lower
SPX Candle: Lower High, Lower Low, Lower Close - Trend Candle
FED Posture: Quantitative Tightening (QT)
Saturday, we said that based on degree labeling, that the most likely course of prices today was lower for a ((C)) wave. Others disagreed. There were some fake-out waves higher in the futures, overnight, but the market opened lower with a solid gap, lower. Prices declined and kept on declining. Typical of a ((C)) wave.
As an impulse ((C)) wave, lower, this would be the only count at present that makes sense. There is no upward overlap between the high of the triangle and wave (1) down.
|S&P500 Cash Index - Fifteen Minutes - C Wave lower?|
The only way the count works from a degree labeling standpoint is if there is a "barrier triangle" at the end of the day. Otherwise wave (5) of ((C)) is too long in price. Remember, in a barrier triangle prices bang along the lower barrier, but they don't close lower than the barrier. That IS what we see, above, and the purpose of the triangle is to "better equalize the net distances traveled between wave (2) and waves (4)". This one does that quite well.
Prices briefly breached the 78% retrace, but then they held there for the close.
The downward price structure is just awful, which is what makes me think it is a ((C)) wave. And, the triangle might be signalling that we've seen the last wave. The day ended on a divergence with the Elliott Wave Oscillator.
I will not start an upward count until price should regain the upper declining tend channel line shown above. So far, the degree labeling considerations have been predictive. With "five waves down" today, there should at least be three-waves up, next. And, there could be more. But that remains to be seen.
For a continuing count of an upward contracting diagonal (c) wave of minute ((ii)), in no case can price trade below the prior low at 2,700. That would invalidate a diagonal.
Have a good start to the week.