|SP500 Cash (2-day Chart) - Diagonal is still Possible|
From what we can see, and the fact that the Dow Jones Industrial Average is now near the prior all time high, it appears that we are in the A wave up of wave (3), at least. Here is what the DOW chart looked like mid-day, during live chat, and you can see how close to the high it was.
|DJIA Cash (Daily) - Close to All Time Highs|
On the way up, today, cash DJIA closed the two gaps in green, and very nearly crossed the high. So, this does look like the A wave, up. (See comment on alternate, below).
How does such a cash count possibly square with a count in the futures - especially when they did what they did in the after hours? Here is what we think the best count is on the futures as it was presented during live chat.
|ES Futures Daily - Intermediate wave (2)|
We agree! We did not predict this type of pattern in advance, and it was not our original count. But, since a low below the June low did not occur - it is hard to argue with. There is a clear wave (v) which is longer than wave (iii), a wave (iii) that is longer than wave (i). Wave (iv) is longer than wave (ii), but does not travel beyond it, and wave (iv) overlaps wave (i). This meets the requirements of the expanding diagonal, and the wave is difficult to explain in any other manner.
And, if the futures did indeed make an ending expanding diagonal C wave lower, then, it would predict at least marginal new all time higher highs.
So, we'll see how it goes, and take it one step at a time. The cash chart rules the pattern until more is known. And, yes, a (1), (2), 1, 2, upward is still on the table, as well. If the look of the diagonal gets strained, we will convert to that as the main count. First, let's see if the new highs are made because the SP500 is lagging the Dow. If we are in Intermediate (3) of an impulse, upward, then if we do finish five waves up in good form, it would be Minute i in that count (not shown).
Again, we have no preference - at this point - as to which count it is: diagonal or impulse.
Cheers! And enjoy the charts.