Thursday, October 5, 2017

Risk Increases - 3

Market Outlook: Fifth Wave Extension of a third wave
Market Indexes: Major U.S. Equity Indexes Higher, except DJ Trans & Utilities
SPX Candle: Higher High, Higher Low, Higher Close : Trend Candle
FED Posture: Quantitative Tightening (QT)

Prices leapt up above the channel we showed yesterday on news the House had finally passed a budget proposal. The Senate would still need to of course. After reviewing all the possibilities, it looks best like a fifth wave extension as shown below.

S&P500 Cash - Half Hour Chart

I could only count yesterday's wave as a "running second wave", and today's gap up as being in a third wave position. As you can see from the chart, there is no significant sign of a downward wave for wave 4 yet, so the uptrend may still have a little bit to go. It's possible that wave 4 will be a triangle to alternate with the flat wave 2.

This seems to agree with the NQ count - which looks like the clearest count of all - as a diagonal in the chart below.

NQ Futures Daily - Over Top of Potential Diagonal

As best we can tell, we are still in wave iii of (v) of that count, as well. Remember, in a diagonal wave (v) can not become longer than wave (iii), so, we'll see if that measurement holds.

For now, have a very good start to your evening.
TraderJoe



4 comments:

  1. Joe I make the same point that i made few days ago..maybe it wasnt clear - that the EWO of DOW/NASDAQ and other markets show the highest ewo (monthly) for the move from last year rally... SP's EWO is almost is almost getting there...which may support the point that this a 3rd wave move from last year. The ferocity of the move would also support this as a 3rd wave.

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    Replies
    1. Looks like Caldaro is right. Nasdaq is not going down. If it does, it certainly is not done making new highs IMO.

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  2. Oui c'est la 3ème vague
    Elle va monter jusqu'où ? ?

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