Asian Markets dropped 2.5% to 3.5%. European Markets currently down about 3%. US markets gave up about 2% after 2 hours of trading. Dow is about 9,860 at the moment, 140 points below its 10,000 level.
European financial problem is actually very serious, Iceland I think has gone bankrupt, Greece is struggling for survival, Spanish banks are facing big problems, some investors have started to wonder whether Euro will still be there three years down the road. But I believe European Union can not afford a disintegration, so the big brothers will step in to do something.
From the chart below, it is more likely that Dow is having its mega wave II correction. Of course I can be wrong. If it is a bear, I would like to maintain that it is a small teddy bear.
S&P wave count appears to be the same except the count on its slow stochastic %K(60)%D(5). But I don't remember Elliott mentioned that its wave principle is applicable to technical indicators.
So, as I have mentioned previously, at this stage it is impossible to gauge the form and depth of this mega wave II. I have to wait for its first rebound to have an initial assessment of its possible form, its magnitude and duration. Dow so far has form 5 mini waves in its down trend direction, I don't rule out the possibility that today's shake-out can be the climax sell-off before its first rebound.
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