Overnight, the market as measured by the ES futures has more than overlapped the prior possibility for a 1st wave up as shown below. But it has not taken out the prior low (PL) either. The chart below is of the SPX500 (CFD) 1-hr timeframe.
So, the primary way to make an 'A' wave up is with an expanding diagonal. But, if the 2nd wave marker is undercut, then there is no way to make an expanding diagonal, up and still follow the 'rules'. On the other hand, if the low is exceeded, then perhaps look for a diagonal downward to end the fourth wave, minute ((iv)). A contracting diagonal is the more likely downward, but we'd also have to look for the expanding possibility if the contracting variety should not be valid.
IF a diagonal is being made, in either case, then the internal waves could be quite whippy, instead of trending, and trading might be quite difficult. So, patience, calm and flexibility remain key tools to success.
Have an excellent start to the day,
TraderJoe
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