3:30 p.m. New York time

Half an hour before the closing bell. The S&P 500 futures began a swift decline at 12:55 p.m. New York time and as the closing bell approached continued to fall.

The decline carried the price below 5892.75, erasing this morning’s principal analysis — a low degree wave 5 is underway — and replaced it with the alternative — wave 4 continues and is in its final subwave, wave C.

9:35 a.m. New York time

What’s happening now. The S&P 500 E-mini futures resumed falling overnight, from 5958.25 down to 5905 so far. The price has remained above 5892.75, the low set on May 19 and reversed to the upside as the opening bell sounded.

What does it mean? If the price moves below the May 19 low, then the rules of Elliiott Wave Theory will come into play.

The current decline is a declining 2nd wave withn a larger rising 5th wave, according to the current analysis. If the price moves below 5892.75, then it has broken a rule: A 2nd wave can’t move below the start of the preceding 1st wave of the same degree.

If that should occur, then wave 4 is stil underway and wave 5 has not yet begun. On the chart, the present wave 4{-10} label will be changed to A{-11}, the 1{-11} label to B{-11}, and the present declining wave from ongoing wave 2{-11} to C{-11}, all subwaves of decling wave 4{-10}.

But that hasn’t happened yet, so wave 2{-11} is working through its pattern and rising wave 3{-11} will follow, all subwaves of wave 5{-10}.

(See “Reading the Chart”, below, for an explanation of the labeling system.)

[S&P 500 E-mini futures at 3:30 p.m, 75-minute bars, with volume] 

Elliott Wave Theory wave labels. Each wave listed on the charts has two components: A wave number, and a subscript in curly brackets that place the wave’s position in the fractal strucutre in relationship to Intermediate degree. The present Intermediate degree, wave 5{0}, began its rise on February 11, 2016 from 1810.10 and is still underway.

The waves referred to on the chart are as follows.

Principal analysis: Upward correction wave 5{-2} is underway and within it is working through a nested series of initial subwaves, wave 1{-3} down to wave 1{-5}. One degree lower, rising wave 3{-6} is underway and is in its final subwave, wave 5{-7},

Within wave 5{-7}, uptrending wave 5{-8} is in its final stage, uptrending wave 5{-9}.

Within wave 5{-9}, wave 4{-10} is underway and is in its final subwave, wave C, is underway. [Updated with this afternoon’s changed analysis.]

Waves Now Underway

These are the waves currently in progress under my principal analysis. Each line on the list shows the wave number, with the subscript in curly brackets, the traditional degree name, the starting date, the starting price of the S&P 500 E-mini futures, and the direction of the wave.

• S&P 500 Index:
• 5{+3} Supercycle, 7/8/1932, 4.40 (up)
• 5{+2} Cycle, 12/9/1974, 60.96 (up)
• 5{+1} Primary, 3/6/2009, 666.79 (up)
• 5{0} Intermediate, 2/11/2016, 1810.10 (up)
• 3{-1} Minor, 3/23/2020, 2191.36 (up)
• 5{-2} Minute, 4/7/2025, 4832 (up)
• S&P 500 Futures
• 1{-3} Minuette, 4/7/2025, 4832 (up)
• 1{-4} Subminuette, 4/7/2025, 4832 (up)
• 1{-5} Micro, 4/7/2025, 4832 (up)
• 3{-6} Submicro, 4/21/2025, 4832 (up)

Reading the chart. Price movements — waves – – in Elliott Wave Theory analysis are labeled with numbers within trending waves and letters with corrective waves. The subscripts — numbers in curly brackets — designate the wave’s degree, which, in Elliott Wave analysis, means the relative position of a wave within the larger and smaller structures that make up the chart. R.N. Elliott, who in the 1930s developed the form of analysis that bears his name, viewed the chart as a complex structure of smaller waves nested within larger waves, which in turn are nested within still larger waves. In mathematics it’s called a fractal structure, where at every scale the pattern is similar to the others.

Learning and other resources. Elliott Wave analysis provides context, not prophecy. As the 20th century semanticist Alfred Korzybski put it in his book Science and Sanity (1933), “The map is not the territory … The only usefulness of a map depends on similarity of structure between the empirical world and the map.” And I would add, in the ever-changing markets, we can judge that similarity of structure only after the fact.

See the menu page Analytical Methods for a rundown on where to go for information on Elliott Wave analysis.

By Tim Bovee, Portland, Oregon, May 21, 2025

Disclaimer

Tim Bovee, Private Trader tracks the analysis and trades of a private trader for his own accounts. Nothing in this blog constitutes a recommendation to buy or sell stocks, options or any other financial instrument. The only purpose of this blog is to provide education and entertainment.

No trader is ever 100 percent successful in his or her trades. Trading in the stock and option markets is risky and uncertain. Each trader must make trading decisions for his or her own account, and take responsibility for the consequences.

License

All content on Tim Bovee, Private Trader by Timothy K. Bovee is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.

Based on a work at www.timbovee.com