Elliot Wave and Fibonacci numbers seem nuanced and crazy until you see the light. If there is a God, one way he, she or it reveal themselves is in Fibonacci numbers and Elliot Wave. It's the Tao Te Ching of the markets.
The market advanced to S&P 500 intraday 1576.09 on October 11, 2007. I believe that was the completion of the Grand Supercycle that began with the formation of the United States.
The market then declined to S&P 500 intraday 666.73, on March 6, 2009. That was exactly 61.8% retracement, the Fibonacci Golden Mean, of the advance from the August 1982 bottom. Some may remember Joe Granville, the then market moving guru, and how wrong he was about the August 1982 bottom.
The market then advanced to S&P 500 intraday 930.17 on May 8, 2009. Drawing a Fibonnaci Fan up from the March bottom is useful. That advance hugged a 38.2% Fibonacci Fan line as it topped. We are now in the 'c' wave down of an 'abc' correction of the 'A' leg of an 'ABC' advance from the March 2009 bottom. I would expect the 'c' wave decline to penetrate the green support line drawn on this chart and end at the 61.8% line of the Fibonacci fan.
If the S&P 500 does break support, I expect massive selling volume, the shorts to pile on, and the bottom of the 'c' leg of the 'abc' correction of the advance from the March bottom to be complete and for the market to resume the 'C' leg up. The 'C' leg up will end when sentiment is bullish again. The pundits on CNBC will be saying the bear market is over and the monetary easing and fiscal bailout policies are working.
The market should then begin another massive 'C' leg down for the second leg down of the 'ABC' correction of the Grand Supercycle. It could get very scary. That may destroy most financial systems and our 'Civil Society.'
Put on equal dollar amount long and short of the Ultra S&P ETF and watch your account grow while taking little market risk. It doesn't matter when you put them on.