The transports are the first to test the lower channel trend line and have bounced thus far, let’s see what the other have in store.
With the impulsive move down this morning, the only two counts left are this move is minute wave 4 of (1) or it’s intermediate wave (2). We should know soon enough as it will approach the lower channel trend lines at the open. Should these channels serve as support, then we could see a move to new highs in the following weeks. However, a breach of these trend lines would indicate a deeper pullback is underway in intermediate wave (2). Possible targets for (2) would be the 50% and 61.8% retracement levels off the August lows.