When I saw a report in Bloomberg Businessweek that Elliott Wave International Inc was suggesting that the ‘correction’ in Chinese stocks may be nearing its end, I decided to look up that chart myself. We all know that wave analysis is not an exact science, and there are many different ways to approach the subject. My reading of the chart of Shanghai Composite Index suggests that there is at least another 10% room left on the downside for China. The reasoning is quite simple, and I’m sure that Mr. Prechter will not entirely disagree.  In a 3-wave correction, the third wave, or what is normally labelled as the “c” wave will be made up of 5 internal waves. When it comes to labelling the internal waves, analysts often tend to come up with different counts. You can see how I have labelled the internal waves of the “c’ wave in the chart produced here. I believe that after a minor move higher to around 2750, the index will commence a move down that will take it to around 2360, which marks a 61.8% correction of the prior large rally. Even after we reach this level, don’t expect the index to commence a huge rally immediately. We will likely range trade between 2825 and 2360 for some more time while we complete the 4th and 5th waves of the “c” wave. Thus, calling the end of the correction right now looks to be a bit premature to me. Ramki