Tuesday, August 30, 2016

Potential Triangle Update and US Dollar Index

Here is the S&P500 hourly chart updated for the potential triangle count. First, we want to note that all gaps, but one (shown with red circle) are currently filled.

S&P 500 Index Hourly - Potential Triangle Count

Second, we have not ruled out that the (b) wave of minute-d (circle-d) can't go lower, just that the timing of the potential triangle favors that it is likely over.

Third, in order of preference we have these scenarios and the rationale.

  1. Triangle - still working out as expected.
  2. Impulse - Nothing rules out 1, up to 15 Aug, then 2 down to 26 Aug
  3. Truncation - insufficient downward movement as of this point in time.
Lastly, we take note of a US Dollar Index which may have started a wave 3, upward, after it's 61.8% downward correction. It may head at least to the upper Bollinger Band before a retrace, or even higher depending on the employment data. This may give oil and gold some headwinds.

Daily US Dollar Index - May be Headed into a Wave 3, upward.


The Dollar has all of it's gaps wide-open at this point in time. Still caution is needed as volume remains "summer light" in many instruments.

We wish you the best in the summer choppiness.
E-T.

5 comments:

  1. Thanks TJ. If this is a running triangle then it favors more upside for the market?

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    1. Yes. IF a running triangle completes properly then, it would likely have a target which is the width of the triangle. Just be aware that we can see scenarios - some of which we have outlined - where the triangle does not complete properly.

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  2. TJ, can you give me any info on the live chat room?

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    Replies
    1. Hi Steve. Send me an email at Elliott_Trader@yahoo.com and I will forward you the details. Thanks.

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