Last week's action in the ES muddied up the short term picture somewhat. Of the two alternates being followed in recent weeks the idea that Minor W3 off the election day low is still in progress has been the preferred count. The alternate is that Minor W3 was complete at the Mar 1st high. That preferred count remains the most likely, but it's probability vs. the alternate has now dropped very close to 50/50, mainly due to the amount of time the market is spending churning sideways. We really need to see a sustained rally to new all time highs relatively soon to keep the preferred count healthy. As far as invalidation levels, the preferred count is eliminated if the selling accelerates and the ES drops below The Minute W1 high of 2277.00 registered on Jan 6. Unfortunately that's a distance away so it may be of no immediate help in deciphering where we're at. This is especially so if the ES continues to churn sideways, which it could well do. The alternate is eliminated if we rally up from here to new all time highs as mentioned earlier.
Preferred count
Alternate count
One final note, and sorry if this is getting confusing: a case could also be made for the possibility of Intermediate W3 being complete at the Mar 1st high. The significance of this is that a very major market top is much closer than would be anticipated in the above alternates.
NOTE: dotted lines show potential EW structures and are not necessarily accurate price/time forecasts
