3:30 p.m. New York time

Half an hour before the closing bell. The S&P 500 futures has risen during the session, reaching into the 5890s.

Elliott Wave Theory: The 4th-wave downward correction that began on May 19 continues. It’s possible that the overnight low marked the end of the first subwave, downward wave A, and that the middle subwave, rising wave B, has began.

But that’s far from certain, and for this report I’m leaving the analysis where it was this morning, with wave A still underway. To put it i context, wave A so far has fallen by $164.75. The potential wave B has risen by $64.25. Quite a difference. Hence the uncertainty.

9:35 a.m. New York time

What’s happening now. The S&P 500 E-mini futures traded sideways overnight, staying between the 5850s and the 5870s, and then resumed the decline, reaching into the 5820s. When the Initial Jobless Claims report was released, at 8:30 a.m. New York time, the price rose sharply back into the 5860s.

What does it mean? I’ve modified the Elliott Wave Theory analysis from what I posted yesterday, May 21. The overall decline is the same, but the details differ to better match the reality of the chart. In describing the analysis, I’ll refer to the waves as they appear on the chart: A wave number followed by the wave’s relative position within the fractal hierarchy as a numerical subscript within curly brackets. See the Elliott Wave Theory wave labels below for a description of the system.

The decline that began on May 19 from 5993.50 marks the end of uptrendng wave 3{-9} and the beginning of a downward correction, wave 4{-9}. The corretion is presently in its initial subwave, wave A{-10}.

[S&P 500 E-mini futures at 3:30.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 next-to-the-last stage, a downward correction, wave 4{-9}.

Within wave 4{-9}, its initial subwave, wave A{-10}, is underway.

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 22, 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