SPX and INDU Updates: First Downside Inflection Zone Reached

In the prior update, I wrote:  "most of these patterns suggest a fourth wave bounce is due, followed by lower lows," which is exactly what happened since.

SPX has now completed the minimum requirements for its pattern, having broken the low of the potential a wave (if this is an expanded flat):

And INDU, so far, has reached into the 43.2K zone, which is probably close enough to 43.1K, if it wants:

As I noted on February 18, this pattern could be called "the market hates everyone, especially you."  And part of the reason for that is, now we have to wonder if the pattern is roughly complete, or if we're dealing with the more bearish diagonal.  I continue to very slightly lean toward that idea that, since the upper line was not overthrown, the less bearish pattern is probably a miniscule favorite, but there's still no way to rule out the diagonal at this juncture:

If the diagonal were unfolding, then the recent decline could be wave 1/A down, with a larger bounce to develop for wave 2/B up, followed by an even more significant drop in 3/C down -- just so folks know what to watch for in that event.  Again, the diagonal would be expected to break the blue wave (ii) low at the minimum and could even turn considerably uglier (if it marked, for example, the end of the bull market, or even just the end of a high-degree wave).

In conclusion, the options now are:

1) The market is at or near the low of this move and will rally back up to new highs either directly or after one more low.

2) The market is resolving the diagonal, with wave 1/A down complete or nearly complete, to ultimately head more significantly lower.

In the event of the latter, we'll stay alert to a decent-sized three wave rally that stalls shy of the all-time high.  Trade safe.