Eh? Let's Really Not Rush Things

Some people like to get up on a Saturday morning and do the crossword puzzle to get the weekend started. Other people 'rush' to publish their often wrong wave analysis claiming that once their so-called objective waves are quantified, they never change. They actually sell this unintelligible system for a hefty sum, and are advertising it again today. Yet, their ever unchangeable waves were wrong at the May, 2015 top - where ours were correct; they were wrong at the August 2015 bottom - where ours were correct; they were wrong again at the October 2015 top - where ours were correct, and they were wrong at the February, 2016 bottom where ours were correct. Folks, they had to change something somewhere, to be wrong enough to have to completely reverse their market count, shut down their web site for two or three weeks, and get back on course.  This is all documented fact.

On the other hand, when you do the crossword puzzle, and the clue for 26 across is "NY baseball team", but so far you have HETS as the answer, you KNOW your answer for 21 down probably is wrong. Dead wrong. It doesn't have an H in it - it has an M in it, so the answer to 26 across is METS. I like to treat the market that way, and once the 'heat of battle' is over look things over and ask, 'what I am not understanding here?', or 'how is the market trying to tell me what the real count is that I just don't see yet?'

I did that this morning, and I came up with a big fat H in the name for the NY baseball team. And, so, as simply as the crossword: something was wrong. Get the eraser out and change it! What? Who gets crosswords done without error, every time?

Yesterday, I published that we may have had a zigzag down - based on the ES futures. But, when I went over to cash I found - you guessed it - a degree violation! Several of them. And, as I stated during the market day, "something was wrong with the ending diagonal being in the wrong location".

The biggest problem is located on Wednesday's chart; the FED day. The downward wave made that day is just "too long" to be a sub-wave of another wave lower. This means it must somehow be part of a continuing (likely third wave) in progress. Here is the chart with the problem wave.

S&P500 Cash Index - 5 Minutes - The Problem Wave

Now, let's reassess the count with proper degree labeling, and all potential diagonals in the correct locations.

S&P500 Cash Index - 5 Minutes - Proper Relative Degrees Notes

We now see the ending diagonal at the low wasn't that at all, but it's more common contracting triple zigzag (B) wave of ((B)). And now the count overall is of an Expanding Leading Diagonal ((A)) wave down, which is of a 5-3-5-3-5 construction followed by a Flat ((B)) wave up.  The 5-3-5-3-5 construction is the only time a third wave may be a diagonal (and it's in a diagonal wave). We showed on the 3-min chart that wave (1) down was a five wave sequence. The form of the overall diagonal is ugly, but it agrees with the futures, and the measurements are correct. Wave (5) is longer than wave (3) which is longer than wave (1). Wave (4) is longer than wave (2) and overlaps wave (1) without traveling beyond the end of wave wave (2), and the motive waves - downward - are all five-wave sequences.

It is important to note the level of the Elliott Wave Oscillator at various locations. It bottoms on the ((A)) wave, and then diverges on the (B) wave low.  Finally, at the end, it is simply too high for a fourth wave. And that is what raises the likelihood of a higher probability ((B)) wave up. Clearly the wave is not following The Eight Fold Path Method, and that is why we suspect only a corrective zigzag overall is in the making.

This all means there should likely be a ((C)) wave down beginning on Monday morning some time.  This is possibly to get the ((C)) wave down to the 61.8% retracement level to make a deeper wave within the potential hourly diagonal that we showed on Friday.

Once again, we have a chart making a clear prediction from the assessment of degree labels. Now, we need to see if that comes true. Are anyone else's charts even making a prediction? But you want to pay them for it, right?

Have a good day.
TraderJoe

P.S. Because of the really intelligent question, I have attached a chart, below, of how the DJIA 'could' have avoided the degree violation between Minor 4 and Intermediate (4). I have no proof, except that the January wave was so out of character, that it could have been a b:3 wave.

DJIA Cash Index - Daily - How it 'Could' Have Avoided a Degree Violation

That means the "net distance traveled from wave 3 to wave 4" would be less, thereby avoiding the degree conflict.