Looking at the current corrective wave structure, I think that we have another leg or maybe even two down before that market finds a bottom. In Elliott wave theory, wave C is based on the drop of wave A by aligning it to the top of wave B as shown in the chart. The market is currently testing the 0.618 fib level. This is also the bottom of the current down channel. This could be a good place for support, but I think we will see a counter rally next week and ultimately fall farther. The order of the stops are:
1) 0.786 -> 3500
2) 1.000 -> 3250 (likely)
3) 1.236 -> 3000 (my guess)
4) 1.500 -> 2800 (maybe)
5) 1.618 -> 2750 (worse case - ouch)
I applied the same wave technique to the sub waves of wave A, and you can see that it initially stopped at the 0.618, then the 1.236 level, but ultimately bottomed out at the 1.5 fib level.
Looking at the big picture, you can see that we have barely even started to fall as much as possible. The average on the 1 month cRSI is still in the overbought range and the big bear markets of the past pull the average all the way down until you see the indicator turn red.
1) 0.786 -> 3500
2) 1.000 -> 3250 (likely)
3) 1.236 -> 3000 (my guess)
4) 1.500 -> 2800 (maybe)
5) 1.618 -> 2750 (worse case - ouch)
I applied the same wave technique to the sub waves of wave A, and you can see that it initially stopped at the 0.618, then the 1.236 level, but ultimately bottomed out at the 1.5 fib level.
Looking at the big picture, you can see that we have barely even started to fall as much as possible. The average on the 1 month cRSI is still in the overbought range and the big bear markets of the past pull the average all the way down until you see the indicator turn red.
