We seem to be caught in what seems like another stubborn corrective wave 2. We now also have what seems like 5 waves up from our lows last week. The market is starting to look a bit tired up here, and a little extended as well. We have risen more than 6.5% in the past week, so we are a little overbought.
I am going to label this 5 wave move as wave [a]. We could have a 5-3-5 corrective zigzag forming for Minor wave 2. We have completed 5 up, so we should have 3 waves down coming to take back some of this up move, before have our next leg up.
For now, I expect wave [b] to come somewhere around 1080-1085. Once wave [b] starts, and the waves unfold, it will be easier to make a target. But that area is the retracement target for now.
We also closed the huge gap down that we had on 5/20. This gap was a target for the bulls, and they seemed to have pushed us all the way back.
This area should serve as some short term resistance.
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