Dow dropped 318 points or about 2% to 15,879 on Friday. With this sharp drop, the current pullback can no longer be the mini-wave 4 correction as mentioned in my previous posts.
A revised wave count is as shown above. It is more likely that wave (ix) has been completed. It is also possible that major wave (5) has also been completed unless major wave (5) has more than 9 waves.
If major wave (5) has more than 9 waves, then the current drop is wave (x) and it is likely to stop at 15,400 level, another 500 points to go, nothing to worry if it is wave (x).
However, it is also possible that major wave (5) has only 9 waves and it has ended, especially if Dow goes below 15,400. Under this scenario I can see two possible outcomes.
Possibility No. 1 - Mega wave 1 has 9 major waves.
Mega wave 1 has more that 5 major waves as shown below. The current sharp drop is the major wave (6) and it is likely to reach 14,750 level for a 11% correction, another 1,000 points to go.
However, if Dow goes below 14,750 level, it is possible that the bubble has burst.
Possibility No. 2 - Bubble has burst.
Mega wave 1 has only 5 major waves and has ended as shown below.
Mega wave 2 may stop at 10,655 for a 35% drop. But if the bubble has burst, it is more likely that mega wave 2 will go to 6,547, the starting point of mega wave 1 for a 100% retracement.
Summary
At this moment the current pullback can be
1. Wave (x) of major wave (5), Dow may drop to 15,400 level for a 7% correction.
2. Major wave (6) of mega wave 1. Dow may go to 14,750 level for an 11% correction.
3. Mega wave 2 of super wave VII. Dow may go all the way to 6,547 level for a 100% retracement. The bubble has burst.
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