Monday, March 18, 2024

Still on the Table

In the ES (a little more likely than the NQ) the potential triangle we have showed for a few days now is still on the table. The ES 1-Hr chart is below in line fashion to make it a bit easier on those eyeballs.


The waves are getting "stupid silly". By Fibonacci ratio, Friday may have been c = a downward to a larger wave, with the diagonal we showed at the outset on the 11th as a leading diagonal and only a very minor truncation in the c wave. Today is possibly an a wave, up, and a wave down.

Remember, if the triangle invalidates, then it is likely the inverse - some kind of 1-2 down. But, for now, there is no evidence of that.

Have an excellent rest of the evening,

TraderJoe

Saturday, March 16, 2024

Weekend Video - ES, NQ & NDX

Here's a video exploring some simple, current Fibonacci ratios in the March contracts that just went off the board. Feel free to full-screen the video using the icon in the lower right for the best result.


If you have any questions or comments, please leave them below the video.

Have an excellent rest of the weekend.

TraderJoe

Thursday, March 14, 2024

Not Easy

I have written often about what I called "The Fourth Wave Conundrum". That is the fact that there are approximately 13 different valid Elliott Wave patterns by which fourth & fifth waves can form starting with an initial three-waves-down. So, your odds of calling such a pattern by random chance are 1:13 or roughly 7 - 8%. Those are not great odds. Last night, the ES 2-Hr futures did not go over the prior high. That made life a little worse as it didn't rule out anything. And, this morning, price went down under what I previously referred to as the "Center Line" of a potential triangle. Here is the ES 2-Hr chart showing the center-line cross.


By crossing back under the center line, there is a potentially valid triangle forming - shown in green. If it does, so be it. It might be the last pattern before a fifth wave upward. But there are two things not to like about this triangle. First, the  wave is forming nowhere near the apex of a triangle. Second, it currently looks somewhat impulsive.

Now, triangles can be elusive things and can get more complicated, so we must be calm and patient. But I also want to note that literally by the skin-of-its-teeth, the count can be the inverse of the triangle which is a diagonal down and a deep retrace shown as . Personally, I'm not married to either count. A true knowledge of the odds simply won't let me be. 

The one thing that can be said, objectively, is that a contracting triangle invalidates below the  wave.

Finally, it must be said that if prices go over the prior high again - which is certainly possible - then one cannot rule out an upwardly pointing diagonal - as the note in blue says - either. But we are not there, yet, at present. So, keep an open mind and let's see how this goes.

Have an excellent rest of the day,

TraderJoe

Monday, March 11, 2024

Still Waiting - 2

Below is the ES 1-Hr chart. We previously indicated that we were looking for a retrace wave that did not go over the top. We are still waiting.


We also said we might have made an hourly contracting diagonal downward. If that is so, the retrace could be quite deep. The CPI report is tomorrow.

Have a good start to the evening.

TraderJoe

Saturday, March 9, 2024

With Roll

Here are the current measurements of the ES continuous contract, even including the level of the current contract roll over. Y = W to within 5 points.


The blue line at 5,600 at the top of the chart would be (3) = 0.786 x (1) where we think the proportions of the contracting diagonal would start to lose their 'right look'. Price is not close, yet. So far, so good.

Friday's daily candle on the roll-over contract was a "spinning top" candle. As with all potential candle formations, a substantial closing lower, in this case, candle would be needed as confirmation.

Sentiment levels have gotten even more bullish (contrary indicator) as the AAII Sentiment level crosses the 51% level.

Have an excellent start to the weekend,

TraderJoe


Thursday, March 7, 2024

Another Horror-Story of a Contract Roll

Below is a daily side-by-side comparison of the roll-over ES futures contract versus the current month only. It's another horror-story of a contract roll-over with fully 60+ points premium in the new contract versus just the current month contract.


The red arrows show the opening price for the next day. Regardless of the Elliott-Wave count, this is a bonkers situation which really needs investigation as it is largely unexplained and getting worse as the months progress. The prior roll-over on this platform was in excess of 55+ points. A typical roll-over in prior years was 12 - 15 points.

Have a good start to the evening,

TraderJoe

Wednesday, March 6, 2024

Still Waiting

The ES hourly futures are shown below in the chart since the most recent high. The cash market says only three-waves-down. So, for now, that is the count. We are still waiting for a wave in which price retraces but does not go over the prior high. There is currently a 62% retrace, and a lower low bar after that.

ES Futures - Hourly - Retrace

The upward count 'can be' complete. But the downward count - if it is three waves - might only be a diagonal of some type. A further upward count might also be a diagonal, but it might also be possible to form a triangle here. So, we look for clues. A lower low today than yesterday would tend to rule out further upward movement.

FOMC Chair Powell is expected to speak before Congress at around 10 AM ET today and again tomorrow. Let's see how things go. 

Have an excellent start to the day.

TraderJoe