Dow Jones Futures are correcting lower inside a wave 2 pullback from the 45,430 low, with the near-term structure pointing toward a 51,182–49,991 target zone. The futures stay vulnerable to further downside as long as they hold below 53,105.
Dow Jones Futures (YM) are pulling back to correct the rally that began at the 45,430 low, and the Elliott Wave count points to more downside ahead. The index stays vulnerable while it holds below the 53,105 high.
The decline from the peak first completed three swings within wave (w), then bounced in a corrective wave (x). That bounce ended at 53,105, and futures have since turned lower again. The current move suggests YM is building another five-wave decline in wave (y), which could complete the broader wave 2 correction.
Wave (y) should extend toward the 51,182–49,991 area, the 100%–161.8% Fibonacci extension of wave (w), according to ActionForex. How futures react there will help show whether the wave 2 pullback has finished or whether the decline is only part of a larger correction.
Over the next 24 hours, any bounce failing in three, seven, or eleven swings would keep the downside intact, provided futures stay below 53,105. However, the pullback still looks shallow next to the prior advance from 45,430. Therefore, the correction could stretch further into a larger seven- or eleven-swing structure.
The near-term bias stays lower, with 51,182–49,991 the key zone to watch for support and any change in structure.
Source: ActionForex
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