Bottom line: The current rally is well described by a primary wave  rebound (P2), in terms of its structure and personality. P2 is tracing out a (W)-(X)-(Y)-(X)-(Z) triple three. The market has either finished W of (Z) or the (Z) segment itself this week.
Why primary wave  and  (or P1P2)?
Describing the stock market sell-off from the 2007 top as primary wave  and the advance from the 2009 bottom as primary wave , of cycle wave c of super cycle wave (a) which has been in progress since the 2000 peak and has taken on the form of a flat, is one of the more viable interpretations of the market structure over the past decade.
This interpretation is described in Chart 3 of the small caps point the way (3/12/10). I’ll mention two less controversial supporting aspects here.
 In terms of the duration, cycle waves a-down and b-up of this giant flat had lasted 7+ years, from the 2000 top to the 2002 bottom and to the 2007 top. To conclude cycle wave c-down with a 1.5-year sell-off ending at the 2009 bottom appears pre-mature.
 In certain indices, such as the Nasdaq Composite Index, the 2008/2009 bottom did not violate their 2002 lows. This would produce a RARE running flat if the 2008/2009 bottom did conclude the flat. In other words, odds favor a regular flat with additional downside potential.
Furthermore, despite the strong rebound since the 2009 bottom, the retracement so far and the sentiment shift are typical of a second wave personality. Here’s how EWP describes second waves:
“Second waves often retrace so much of wave one that most of the profits gained up to that time are eroded away by the time it ends. … At this point, investors are thoroughly convinced that the [bull] market is back to stay. Second waves often end on very low volume and volatility, indicating a drying up of [buying] pressure.”
The wave structure of the primary wave  (or P2)
Chart 1 (on the Dow) and Chart 2 (on the Russell 2000 index) illustrate an intuitive wave count of the current rally. The two relatively sizable corrections, Jun09-Jul09 and Jan10-Feb10, are obvious candidates for (X) waves. From this perspective, the entire rally is a triple-three corrective structure (W)-(X)-(Y)-(X)-(Z), with each three being a smaller double three W-X-Y.
It only requires a casual examination to discover that (W) has 11 (or 7) waves, (Y) has 11 waves, and (Z) has 3 larger waves (or 11 smaller waves) so far. The number of waves all support piece-wise corrective structures, as well as a larger corrective structure for the entire rally.
As of this week, the market has either finished W of (Z) or the (Z) segment itself. P3 is directly ahead within this interpretation (e.g., after X-down and Y-up to conclude (Z)-up, if not already).
The USD index has concluded its one-month correction and has resumed its advance. The advance is wave 5-up of (1)-up since its Nov09 low (Chart 3). Wave 5-up in USD may coincide with wave X-down of (Z)-up in stocks and wave (2)-down in USD may coincide with wave Y-up of (Z)-up in stocks.
The VIX index is now at the pre-crisis levels (Chart 4). This week’s low in VIX is 16.17 while the Oct07 low was 16.08 and the all time low in Dec06 was 8.6.