In NY for the day, then on to Chicago tomorrow.  If you haven’t yet RSVP’d, tempus fugit.  The most up-to-date schedule can be found HERE.  Click HERE to contact me.

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While the rising red channel gave up the ghost after tagging the 1.272 we discussed last week, the potential remains for the channel to be simply widening. If so, this slide should be pretty much done and it’s time to jump in with both feet here at 1687.50.

Note, there was no .786 Point B back in July, so a Butterfly is a less likely ultimate outcome than a Crab Pattern, which terminates at the 1.618 (1767.63.)

We’ve already had the backtest of the 1586 high from 2007 (the yellow grid), though a second is always a possibility.  But, the more likely target is a steady grind up to the 1.272 at 1837 around Oct 11.

What’s the turd in the kiddie pool?  The three rising red channels — the latest of which broke down last week — are part of a larger system.

continued for members…I say “system” rather than channel, because it’s more a series of stair steps than anything else.  Note how crossing each of the major Fib levels (.236, .500, .786) led to an ugly aftermath — the drops from the 2010 high, the 2011 high, and the Sep 2012 highs.

If this expanded channel breaks down (ES dips below 1660) we could be looking at a drop from 1837 to 1585 by early December.

GLTA.