This remains a yuck market. While one could get lucky and guess exactly right about what's coming next here, I don't think this market is at all clear-cut at the moment. In my opinion, the majority of Elliotticians tend to advance wave degrees too quickly and declare corrections (or impulses) over too soon. If they're bearish, they'll tend to be early on tops and assume the next big wave down has started (I am sometimes guilty of this myself) -- if they're bullish, they'll tend to do the opposite.
Some Elliotticians have assumed that wave (iii) down has started already, and I continue to accept that this is indeed possible -- but I feel it's less likely, again based on the best evidence provided by other indicators. As always, it's all about probabilities... so 60% probabilities will still be wrong 4 out of 10 times, and a strong break could always show up tomorrow -- but on Friday I warned that I felt the market was entering a chop zone, and so far that's been the case. Unless it breaks down strongly here, I currently see limited evidence for a higher degree third wave decline yet.
The first chart I'd like to call attention to is the RUT, which again argues for a choppy correction to be followed by new highs. While SPX presents more clearly as a double-zigzag series of ABC's, RUT looks more like a nested (1) (2) series that's in the process of forming wave C. It could still be a double zigzag, but going with the "trade what you see" philosophy, I don't think the double zigzag works as well.
What I especially like about the RUT chart is the clarity of the invalidation level for a fourth wave decline, although keep in mind that this would not invalidate a double zigzag. Bears should watch for a clean break of the rising trendline as a possible sell signal, since most double zigzags will maintain a pretty clean channel.
Whether one calls the RUT pattern a double zigzag or a nested C wave, it is darn near impossible to view the upwards movement as complete. The only way that becomes possible is if one views the first 3-wave-looking structure as a really ugly A wave with an extended fifth. Again -- always possible... I'm just working off the probabilities here. Also note the gap open off the 820 high that gives bulls a target to aim at.
The next chart is the SPX, which could follow a similar path. The complexity of the correction in RUT and SPX isn't required to play out as illustrated, this is simply a SWAG (an educated guess) as to how things might play out. R2 is key resistance on SPX, and sustained trade above 1363/64 would favor the odds of a new high being made more directly.
In conclusion, the odds favor further chop with an eventual upwards resolution, to be followed by a major turn lower. Barring that, a strong breakdown of the upward-sloping channel would shift things more immediately into the bears' favor. Trade safe.