Last night I mentioned " If a w-x-y 4th wave correction completes as indicated, a potential trade setup may materialize where we have wave w=y at 1096 which is also located at the most common Fib retracement for 4th waves of .382. This also is where the previous breakout occurred at A (red). Should provide support and a high probability trade with minimal risk. Any trade above 1113 would most likely indicate that the correction was over".
Well, the Alternate count may have been correct as 1101.25 was slightly exceeded, followed by a retest of 1113 that failed, on an opening gap ( see lower time frames), followed by a 5 wave decline. So , I was right on the desired direction but then 1096 didn't hold.
Based upon the wave principle, C waves are 5 wave structures. If you were counting the waves, it kept you out of trouble. We didn't have a complete 5 wave move down until 1088.75. 1088.75 was also a .50 retracement between waves ii and iii. That is still an acceptable retracement for wave iv. The Bullish Hammer confirmed that wave C had terminated giving a trader the opportunity to go long. If anyone took this signal, don't let your profit get away. The current move down from 1104.5 can't retrace more than 1088.75 to maintain the bullish posture for a wave v of ii circle.
Best of Trading!
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