Dow dropped 130 points or 0.8% on Wednesday. Dow opened lower on Thursday morning, it dropped another 70 points after 30 minutes of trading. Dow is having a higher degree correction.
Possibility 1 - Mini-wave 2 correction.
As shown below, Dow is forming wave c of mini-wave 2 of sub-wave iii of wave (ix). This is a more bullish scenario as wave (ix) will take a longer time, say 4 to 6 months to complete and it may reach 17,000 level.
Possibility 2 - sub-wave iv correction.
Dow is forming wave a of its sub-wave iv. Dow is likely to complete its sub-wave iv by early January 2014. Sub-wave v may take another month to complete. Wave (ix) is likely to be completed before end of February, 2014 and wave (ix) may reach only 16,200 or it may even end at wave (iii)'s high of 16,086 to form a double-top reversal pattern.
On the completion of wave (ix) I will have to answer the crucial question of whether that is also the end of major wave (5) and mega wave 1 as shown below.
Mega wave 2 may go for a 30% pullback. Be careful.
However if the subsequent pullback is the major wave (6) then I will have to worry about the possibility of an 'Expanding Triangles' on the completion of major wave (7), that will be years later, so no need to worry about that at this moment.
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