This post by DanEric40 has been promoted from the StockTock Social.

1) VIX chart shows us breaking the wave 3 of 3 channel. That means we are working on wave 4 of 3 channel. I had a big main point that the VIX shows sentiment changes and thus wave changes. VIX shows we are working on 4 of 3. Check it out!

2) Wave 4 of 3 only retraced .354. Seems insufficient. 1020 (.382) or 1070 (.50) would be better retrace targets.

3) A giant zig zag would be my projection for now with market grinding upwards by first week of December or so to wave 4 peak. 1020 minimal target. I had a very nice post on this aspect but alas…grrrr..

4) Alternate count is a giant “expanded flat” that actually breeches 845 low and then expands back up toward 1020 or just above. I rate this as a lower probability for numerous EW reasons and others, however it is a viable wave 4 of 3 pattern. We will know early this week.

5) Second alternate count. Markets go straight to hell and breech into the 700’s. Reason: the possibility of major systemic failures still is a grave threat so it can never be ruled out. My basic message here is this: go long at your own peril. However, do not underestimate the bulls and PPT. They had a dogfight at the mid-800 level and it will not be easily breached. However systemic failure can be the one catalyst that does the trick. For this reason, I must always mention this possibility. I only say this to emphasize just how dangerous this market continues to be for longs of any kind.

Since that seems to “cover” every market direction (and people chide me for that), I will say that I favor, and have been favoring, a giant zig zag up to a 1020-1050-1070 peak area now for over a week. And so far it has traced out half of a zig zag with the necessary down correction period. Question is, will it trace the other half? So until my primary wave counts are nullified, I have to stick with this scenario as my number #1.