US100 Elliott Wave: Wave (3) Extends Toward 2.618

Nasdaq is moving higher, exactly the direction called out on Friday. No surprises there. The market is doing what the count said it would do.

But trends don't move in a straight line, and anyone expecting a clean vertical line to new highs is going to get shaken out. Wave (3) is extending toward the 2.618 extension on the 4h chart, and once that impulse wraps, the next phase isn't more upside. It's a pullback.

Where is US100 in its wave count right now?

Look at the chart. Wave (1) and wave (2) are already in place, low near 28,800 for wave (2), and wave (3) is currently stretching upward, tracking toward the 2.618 extension level. That's the extended wave in this five-wave impulse, labeled circle 1 on the higher degree.

This lines up with the broader structure too. Zoom out and you'll see wave (b) formed as a contracting triangle before wave (c) dropped into wave 2 of the larger degree. The move up since then is wave 1 of the next impulse, and wave (3) is the meat of it.

Why does wave (4) matter more than wave (3) right now

Here's the part traders skip past. Once wave (3) finishes its run at the 2.618 extension, wave (4) has to happen. That's not optional, it's how impulses are built.

The shaded zone on the chart marks the 0.236 to 0.382 retracement, right around the 29,800 to 30,000 area based on the drawn levels. That's the zone being watched. If wave (4) develops there, that's where the internal structure gets dug into for clues on the next leg.

Wave (4) corrections are notorious for chopping sideways or faking a bigger drop before resuming. Traders who mistake wave (4) noise for a trend reversal end up on the wrong side of wave (5).

What does the blue path actually represent

The blue path drawn on the chart is a working scenario, not a confirmed sequence. It shows wave (4) pulling back into the shaded zone, then wave (5) launching toward roughly 31,000, completing circle 1 of this larger degree. After that, the drawn path shows a deeper pullback into circle 2 before the next leg starts building again.

Wave (5) is the target. But the market has to build wave (4) first. Forcing an entry before that correction plays out is trading hope, not structure, and hope isn't a strategy.

What should traders watch next

Save this chart. Compare it against the next candles as they print, and update the count as price gives more to work with. That's how Elliott Wave analysis actually works: level by level, wave by wave, not by guessing the ending before the middle is even done.

US100 is respecting the impulse so far. The 2.618 extension on wave (3) is the current focus, and the 0.236 to 0.382 zone is where wave (4) gets its test.