Further notes on Dow's 2% drop on Tuesday

Look at the above 15-month chart for Dow, to me Dow has either completed its major wave (V) (Possibility 1) Or Dow has completed its wave 1 of its major wave (V) (Possibility2)

For Possibility 1 where (V) is completed, Dow will have to drop another 1,000 points to 10,000 level to form a major A-B-C.

For Possibility 2 where only wave 1 is completed, and if (V) were to take the form of (I), then wave 2-3-4-5 are likely to be completed within next two months (May & June).


I have decided to assume that Dow will have wave 1-2-3-4-5 for its major wave (V) and that Dow is currently on wave 2.

I usually look at charts for all the 3 indices, Dow, Nasdaq and S&P, to see which one provides a clearer wave counts. All the 3 indices must behaved the same way ultimately. At this moment S&P provides a clearer wave count as shown above.

Wave 2 takes the form of an expanding A-B-C as shown above. Judging from the shape of the corrective wave A-B-C, it is possible that wave 2 may end around current level within the next 2 days. The whole major wave (V) be completed by middle of May is another possibility if the major wave (V) take the form of a wedge formation with overlaping waves 3-4-5.

It is also safer to keep an eye on Possibility 1, the moment the current down-wave goes beyond 3%, I may have to switch back to Possibility 1 option.