Thursday, January 26, 2017

An Update from the Live Chat Room - 11 AM Special

There is now a slight breach of the lower diagonal trend line. I am convinced that with four attempts on 2301, without breaking 2301.26, and now a breach of the lower diagonal trend line, that there has indeed been a diagonal of some type. Now the question is whether it is "ending" or "leading".

SP500 15-Minutes : Diagonal "Of Some Type" Has Occurred

Now that a diagonal "of some type" has occurred, it could: 1) end the entire move wave v, or 2) be either an "a" wave in a larger diagonal, or a "i" wave as a sub-wave in a further move up. Only the depth and speed of any retrace will tell us that with certainty. Remember, an ending diagonal would need to be fully retraced in less than the time it took to build it.

11 comments:

  1. Update as of 1:30 PM ET; the fourth wave of such a diagonal has just busted lower. Looks like the correction is beginning.

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  2. Thanks, Joe, for all the in depth analysis of the market using EW. I'm consistently amazed at what you do and keeping us informed GRATIS and being frank enough to point out any error. Please keep doing what you're doing!
    rose

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    1. Welcome Rose. I think of you often when I do these.

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  3. Joe,
    Thanks for the mid day update. To be honest, I wasn't comfortable with the look of the diagonal posted yesterday. Another possibility I was considering after this mornings slow action is that we are in an expanded or running flat minute 2. Link Below.

    http://tos.mx/Lwh4i3

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    1. Tom, quick question: that would mean what for the short term target of wave5 of 3?

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  4. Since minor 3 is shorter than minor 1, minor 5 is limited by the length of 3. That means the upper limit of of minor 5 and Int 3 is 2323 and change. I'm thinking minor 5 would have to be an ED since an impulse would have to exceed that level. This of course would require minute 1 to be recounted as a 3 instead of a 5 which as I lookk at a 30 min chart is viable. Not married to this but the current action looks more corrective than anything else in my view.

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    1. Thank you Tom! much appreciated! do you trade the RUT by any chance? trying to figure out my way out of that maze :-) if you or anyone has a count....will love to see too. thx

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    2. Sorry, I only trade SPX & Dow via leveraged ETF's.

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    3. For minute (i) of a larger diagonal, consider 2282 as -iii, where iii is now, and the "flat spot" at 2280 as -iv, with 2284.50 as -v of A of minute (i); then consider 2279 as B of minute (i); then consider the entire diagonal as C of minute (i) - again for a larger diagonal, if and only if, 2301.26 has been exceeded, which it hasn't yet.

      It's a bit of "reverse engineering" but one of the traders in our group called that "flat spot" a fourth wave. I just called it 'a' of the larger flat for alternation, is all. I will post this count if needed, later, as the best alternate.

      There's nothing magic about 2301.26, other than as the end of a potential diagonal wave.

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    4. That is the way I was looking a the structure. Thanks for the reinforcement.

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