The 1204 gap target looks like it may have been it for the preferred wave 2 counter-trend rally. However, the market has not given us official confirmation yet: so far off the 1204 high, it has formed either a 1-down 2-up 3-down; an a-down b-up c-down; or a nested 1-2, 1-2. We need at least one more impulse lower to form a 5th wave and confirm the larger impulse move down. It has left itself in the perfect setup for a nice gap down in the morning, especially if our preferred count is correct and this is 3 of v, but it's not required to confirm the wave.
Even if we get the confirmation of this small impulse, it's not completely clear sailing until the 1121 low is broken, but we'll worry about that if it starts to look like this leg down is just a larger a-b-c correction. For reference, see the "first alternate count" -- second chart down on the post immediately below this one. So, as we say in the biz: "Don't count your waves before your chickens hatch! Or before the cows come home to roost, whichever is greater." Or maybe I'm confusing the saying with something else.
Either way, the preferred count is looking very promising, and I'll come back and take a look at what the futures are doing later this evening.
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