Executive summary
Trend bias: Bullish wave iii nearing its end.
Immediate target: 24,165 based on 1.618 extension of wave i.
Key level: Wave iv decline is mild and likely reaches 22,837 and the bullish structure is preserved.
Current Elliott Wave analysis
The 4-hour Nasdaq 100 (NDX) chart reveals an Elliott wave impulse pattern that is incomplete.
The current count we are following is that wave ‘iii’ is nearing an end and may lead to a wave ‘iv’ decline. Keeping an eye on the 24,165 price zone as a possible end to wave ‘iii’. When wave ‘iv’ begins, we do anticipate its correction to be minor, perhaps less than 5%.
All corrections since the beginning of May have been very shallow. One clue that perhaps wave ‘iii’ is nearing an end is that the late July correction is about the same size as the June correction (see the pink boxes). This suggests those two corrections may be of the same degree of trend.
With that being the case, then several wave 3’s will start coming to an end as Nasdaq continues higher. Stated another way, Nasdaq is embedded within a 3rd wave at two or three larger degrees of trend. In essence, this means the pattern is still incomplete and volatility should grow in the corrections as the price grinds higher.