So should we be waving "goodbye" to stock indices and look forward to months of bear markets from here?

So was that it? Did the stock markets top out intraday today, and now it's down to retest the March lows? We've been favoring the view that this has been a bear-market rally from March to complete a "B" wave, and I notice that Tony Caldaro has marked today's intraday high - provisionally at least - as having finished the "B" wave, at his Elliott Wave Lives On website (you can see his discussion there and click on his public charts link to see his Objective Elliott Wave chart for that) (his site is included in the sites list at right side of the page). Frankly I don't disagree with that view, but I do see the Elliott Wave count slightly differently. Not that it matters too much in the scheme of things - still, I've marked on the SPX chart (below) my view of the count including the "diagonal wedge/channel" that I was posting and tweeting about recently. Remember I made the remark that Major wave A finished with such a channel and now it seemed that Major C (to complete the Primary "B" for the whole rally) was completing in a similar manner.

Only thing I'm not so sure about, it's possible that my "wave (3)" is the shortest wave which would break the EW rules - so I'll need to check that. An alternative is that what I marked as (3) is really wave (1) (as a zigzag), and then what I marked as 1/a is the wave (3) with a diagonal's overlap of the following drop as wave (4) overlapping wave (1) - and then the next two swing highs on the hourly chart below, as the "abc" zigzag for wave (5). Another alternative view might be that the diagonal I've marked is a part of a larger wave (3) and didn't finish a 5th wave to complete the "B". But all in all, I think we should respect the idea that the wave "B" is done, subject to confirmation by breaking the prior swing low support levels. Tony Caldaro has mentioned a couple that he finds important, in his update this evening at his site.

My earlier post this evening here, made two points that I don't mind reaffirming: one, it's fair to look for confirmation. Until then, in addition to the market action today, we have the indicators (such as the bearish-looking McClellan Oscillator, above right), Fibonacci levels, and other analytical methods - and other analysts we respect - pointing to the markets topping out. Second, here is the real take-away: RESPECT THE ACTION. If we are correct and the market has already topped out, then we do NOT think this is a matter of a simple pullback that should be bought. Instead, we think it's been a great selling opportunity, and we should fully expect to see the markets trending down for weeks and perhaps months to come. I kinda favor a view that the drop will be steep for about 2.5 or 3 months, but it can be a longer time period. We'll need to see how it plays out for a bit to be sure.

But if the action today is just the beginning of the downtrend that's yet to come, then let your imagination fill in the blanks - it won't be pretty.