Weekly preview

Short term view - choppy move up.
Intermediate term view - intermediate term low, a few weeks before the market really start to rally.

Very volatile week - bang lower, strong rally all this expected and then another huge red bar. Second indecision weekly candle, no confirmation for a reversal with impulse in the opposite direction, three waves up and down.
The weekly histogram and the Weekly Stochastic of the Summation Index hint that a strong rally will not start immediately. This is a good news, we will have enough opportunities to add to a long position.

Short term - two options burning time to absorb all sellers, with only three waves up and down the options are leading diagonal or ED, LD looks better. Alternate final flush lower for a capitulation and test of the low later(the W-X-Y chart which I have shown yesterday).

TECHNICAL PICTURE and ELLIOTT WAVES
Short term - suggested by Mily. At the end it is what I want to see a few week time before a strong rally begins. The move lower is corrective so far too and the ED does not fit with all indexes so I think this is a better option - leading diagonal and test of the low. Alternate scenario sharp plunge and test of the low a few weeks later.

Intermediate term - we have sideway move for two weeks with very volatile swings up and down 70 points are the new normal. The bulls are still defending MA200. I see a lot of obsession with MA200 in Internet.... like if the price moves below it it's game over. There is no such thing. The indicators RSI/histogram - I expect to see divergences.
Another lower low and the preferred scenario is wave IV/V(green). The other option is the top is in and multi month correction is running(red).

Long term - one final rally higher. The indicators are showing serious technical damage so this should be intermediate term low lasting for months and the subsequent rally should be the last one from the Feb.2016 low.
The histogram with huge trough only in 2008 it was bigger. Notice the similarities - 3 acceleration bars lower then flattening for a few weeks and the rally begins. Now the flattening phase should begin and price with bottoming pattern a low and test of the low.
One option is quick flush lower which will be bought(weekly candle with a tail) and test of the low with higher low or LD/ED up and down for 2-3 weeks flattening and a rally higher.

MARKET BREADTH INDICATORS
Market Breadth Indicators - I think they are building divergences and pointing to intermediate term low. Percent of Stocks above MA50 several times with oversold readings and staying around this levels for two months - this happens usually in a down trend... big red flag.
McClellan Oscillator - around zero, another higher low for double divergence expected.
McClellan Summation Index - higher low so far, divergence expected .
Weekly Stochastic of the Summation Index - sell signal, this one was bothering me seriously now I know why.
Bullish Percentage - turned up, no buy signal so far.
Percent of Stocks above MA50 - several oversold readings, more divergences expected.
Fear Indicator VIX - lower highs and divergences expected.
Advance-Decline Issues - one more flush lower to oversold level with divergence will look great.


HURST CYCLES
Day 34+4... waiting to see one more low or not to pinpoint the 40 day cycle.

Week 20, this should be 40 week cycle low.

Tom Demark SEQUENTIAL AND COUNTDOWN - this technique spots areas of exhaustion.
Some price flips trough the week and now setup at day 4. Still no price flip to the downside, but the indexes should rally Monday/Tuesday and close above 2645 for the setup to continue.
The histogram with small divergence before the rally, now it will be great if we see a bigger divergence to confirm a low.