So what do you want to look at first here? The ugliest thing? Or the best-case scenario? Let's start with the ugly, I guess.
Here's the ugly, via a chart I called attention to back in August of 2024, specifically because it was so ugly:
But let us ask: Could the ugly become uglier? (i.e.- could the market ultimately keep rallying? ("ultimately" meaning after the current wave runs itself out, not immediately.))
And the answer is, perhaps surprisingly, YES. It could -- if we were to make the assumption that the 2020 low was the start of wave 5 and the wave from 2022 to present is actually wave 3 of 5 and not 5 of 5. That seems less likely based on other long-term counts -- but it's not impossible. So let's look at one way that could play out:
This chart discusses all this from a slightly different perspective:
The above chart seems to think we should still be looking lower either way -- but why does it think that? Well, the obvious answer can be found in INDU. It's pretty hard to see the decline from the black bull 3/C label as anything other than three waves. Which means it's incomplete (it requires 5 waves). The short-term bull stick save would be to turn yesterday's low into a b-wave, then rally back up to snag the old T2, THEN decline again. But it's hard to see how the decline ends here, either way.
The next chart returns us to SPX, where we see a similar situation:
Now we move on to COMPQ, where we find similar options (COMPQ could get away with one long wave down to the first red "?" to mark its corrective decline, *if* it were forming a corrective decline):
Finally, we end with NYA, which shows a similar "near-term bearish, still intermediate bullish" possibility. For NYA, if we were trying to find a bull count, the black a/1 would be W and bull Y would reach c = a parity roughly where the label is -- to complete a double zigzag. (An extension of c would put Y down near the blue bear (3) label.)
Amazingly, that WXY count is NOT as far-fetched as it might seem -- if you'll recall, there was some question a few months back as to whether the black ending diagonal might actually be a b-wave. The WXY would reconcile it as a b-wave.
In conclusion, to make things as clear as possible: There appear to be low odds that the market will escape without more downside from here, so bears are probably in the clear for the time being. But -- once we get that downside, bulls will have a "last call" chance to flip everything back to their favor.
While that currently "seems" less likely, given the direction everything appears to be headed, directions can change -- and the current patterns could allow it -- so we'll keep it in mind and watch carefully when those inflection zones arrive. Trade safe.