Selling got ugly today in the morning and 1249 was not much of a support as it broke easily. But as expected, the bottom for this wave seemed like it was put in at 1234 and now we are seeing the counter rally. I favor a counter rally to the Fib area (perhaps test the 200 ma or even the TA) and then finish the selling on another W5. Technically speaking, the wave from 1040 was finally retraced to it's minimum Fib target area. I've talked about this for months but I thought this correction was going to come after making a new high and not now. Whatever the case, we'll see if the market is able to capture the 200 day ma and the TA by the end of the week. If it does, the market still has a chance to go higher but closes below these levels just confirms more selling.
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