ADR index

Yesterday the S&P fell below the line I was talking about but sentiment is also at an extreme negative. This does not give me comfort for the short trade. So I looked at the ADR index which also broke below its sept low. The fall has a series of overlapping legs and yes I was expecting this index to eventually start a 3rd wave lower, so has it?

Maybe, maybe not! There are two alternates, First that the recent bounce is wave 2 and 3 started. Then we only retrace the recent fall in the next bounce and then the decline resumes. However the weekly and monthly charts suggest that this recent expanding structure is wave 5 of the impulse down from the April high and a larger bounce might still be on the cards. The break of the Sept low is reason to be nervous, but both cases tell me to wait for a bounce first and then figure it out.

 

I will be in meetings today so further updates during the day will only come if time permits