Wednesday, February 15, 2017

Trend Line Touch

Today's movement was sufficient in the ES E-Mini S&P Futures to create an upper trend line touch on the weekly chart. Here is the chart, as a reminder below.

ES E-Mini S&P 500 Futures Trend Line Touch

Price still remains in Intermediate Wave (3). It can go higher. There was nothing at the close today to indicate a reversal was imminent or occurring (as far as I could tell).  It's possible for the upper trend line of the channel to provide some resistance here : that remains to be seen. Persons who follow the futures will now note that in this count, Intermediate (3) is now longer in points than Intermediate (1). Some had raised a concern in labeling Intermediate (2) as a flat earlier on that then Intermediate (3) wouldn't be a longer wave. Well, there it is (in the futures anyway).

Notice that a chart like this would now not envision a final top until at least the autumn because there is no ending signature such as a diagonal or a triangle (shown) at this time. Perhaps a triangle like that would be coincident with another "sell May - go away" scenario, this year.

While the internal count of Intermediate (3) is still a bit of speculation - because there is nothing conclusive to say waves have ended yet - this is the count that best fits The Eight Fold Path Methodolgy and the signals from the Elliott Wave Oscillator on the cash chart of the S&P500, using 120 - 160 candles. As I noted yesterday, if 2347 was exceeded - which it was today - then Minor wave 1 would be moved down to the post-election high, which is, interestingly, where I had it originally.

SP500 4-Hour Chart and The Eight Fold Path Methodology

Wave minute ((iii)) within Minor 5 has now exceeded 1.618 times minute ((i)). It should be noted on the cash chart today - with the fresh new highs - there are no gaps above the market, and all of the gaps are below the market. Novel, huh? It's going to be fun when the algorithms go "gap hunting".

Well, have a good night and stay patient and flexible.
TraderJoe

12 comments:

  1. Greetings Joe,
    Speaking of moving minor 1. I've seen some other work that places minor 1 in mid Dec at the location you have as minute 3 of minor 3. It then places minor 2 in late Jan where you have minor 4. This of course means we would now only be in minor 3 instead of minor 5. Looking at the EWO on your chart, the current reading is not that far form the reading at your 3 of 3 high. I was wondering if the EWO and the market continue to rise and that current high EWO reading is exceeded if it would lend any creedence to the count I've mentioned.

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    1. Yes, that is a possibility if the highest EWO is exceeded. Right now that is reserved for wave iii of 3, per the method.

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    2. Agreed, Out of curiosity I applied the EWO from the Nov low to the Dec high to see what it would look like. It it does not even come close to confirming that the period could have been only 1 impulse. In fact it looks just terrible with wave 3 giving a lower EWO reading than both 1 & 5. Not a wave 3 characteristic. Thanks for indulging my musings.

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  2. this count seems reasonable - however in real time the running triangle really played out to perfection so perhaps minor 3 ended at 2300

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    Replies
    1. An equally good possibility in this case.

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  3. Everyone realized that a wedgde was forming but thought it to be an ED. Once the ED was invalidated, the wedge upside breakout came into play. When reading elliotwaves become difficult, pattern helps in fixing minimum targets as in case of SPX and NDX.

    https://invst.ly/3a46m
    https://invst.ly/3a49s

    I have not drawn the channels to accuracy but more or less targets played out!

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  4. Thank you Joe. I'll play devils advocate for a moment. By moving minor 1 down to the post-election high, you've now created what I consider to be an absolute no-no, because all of minor 3 is well below the 0-2 trendline. No part of minor wave 3 was ever above that trendline, when, normally, no part should have ever been below it. I'm still not clear how to count the thing, however, I think the 12/13 high at 2278 was the end of something important. Then, it's quite possible that there was a running contracting triangle from the 12/13 high to the 2/08 low. Then there was the breakout of that triangle. Wave B of that triangle was 67 points (2234-2301,), and the breakout has now traveled 66 points (2285-2351.)

    So, putting all of that together, the way to count the entire move as an impulse would be 2213-2187-2278-2285-2351. There is big time alternation between wave 2 & 4. All of wave 3 is above the 0-2 trendline. Wave 3 is not the shortest wave. I think this would align with your EWO as well. The biggest problem I see with this count is how to sub-divide wave 1 into 5 waves. My solution to that is to say that wave 2 is "invisible" as it occurred either during the gap, or it occurred during the election night insanity. (This count would have to change if the current thrust carries above 2376, as that would make wave 3 the shortest wave.)

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    1. So, in a running contracting triangle, wave 'e' MUST travel back over the top of the high preceding the triangle in order to be corrective to it. If the triangle is a B, then "e" must travel back over A. If the triangle is a 4, the "e" must travel back over 3. There is a strict reason for this : to prevent 'any' running structure or just bumps of higher waves from being called a running triangle. Unfortunately, even though I tried that last night before publishing, 2285, does not downwardly overlap 2278. So the running triangle idea was discarded before the ink was even dry. Further, the DOW can not be in any way counted like that.

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  5. Hi Joe, can u please send me info about your live chat room? I have a friend who wants to know more about it....raymondjonesmails@gmail.com

    Thank you

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  6. Hi Joe...didnt get your mail. did u send?

    ReplyDelete