Following the all-time high of 2137.1 and subsequent drop to 1833.5, an upward correction that initially appeared to be forming as a contracting triangle has since broken out of its converging pattern and now has the appearance of a "Flat (3-3-5)"-type ABC correction. Within this correction, two primary rallies -- to 2021.4 and then to 2022 -- have hit resistance just flush with the level that represents 0.618 of the distance from 2137.1 to 1833.5 (the exact .618 point is 2021.1).
So far, the length of the wave labeled "c" is right at 0.786 of wave "a", and (if) terminating very close to the extreme of wave "a" would be typical of a "flat" correction. These rallies seem to be getting rejected when they reach the lower trendline of an upward trend channel that formed after the 2009 low.
Unless it becomes more complex, the correction looks like it could be complete, or nearly so, and at a turning point. I am still on the fence as to whether to consider this correction a 2nd wave or a 4th wave. The depth and exactitude of its retracement to the .618 level would imply the former, while the overall wave structure since 2137.1 makes me lean toward counting it as the latter. In either case, I think it is probable that the index will start making its way down to a target below 1833.5.
So far, the length of the wave labeled "c" is right at 0.786 of wave "a", and (if) terminating very close to the extreme of wave "a" would be typical of a "flat" correction. These rallies seem to be getting rejected when they reach the lower trendline of an upward trend channel that formed after the 2009 low.
Unless it becomes more complex, the correction looks like it could be complete, or nearly so, and at a turning point. I am still on the fence as to whether to consider this correction a 2nd wave or a 4th wave. The depth and exactitude of its retracement to the .618 level would imply the former, while the overall wave structure since 2137.1 makes me lean toward counting it as the latter. In either case, I think it is probable that the index will start making its way down to a target below 1833.5.