Friday, January 4, 2019

Three for Three

Market Outlook: Likely Long Term Top Identified
Market Indexes: Major U.S. Equity Indexes closed higher
SPX Candle: Higher High, Higher Low, Higher Close - Trend Candle
FED Posture: Quantitative Tightening (QT)

Three FED chair persons were interviewed today, and the result, so far, is 'three-waves-up". The three waves up, so far, are: 0 = 2,347, a = 2,521, b = 2,444, and c = 2,538. That's all well and good. We do not know for certain that the up waves are complete. There was not a good clear sign of reversal by the end of the day.

Daily ES prices had another outside reversal day; this one was to the upside. Prices tried to tag the 18-day SMA but just missed it.

If upward movement should end here, then the three waves up 'could' be part still of a minuet wave (iv) triangle. And if upward movement continues, then we'll look for the best count that fits it. Right now, it's a bit of a "wait and see" game.

So, remain flexible, calm and patient.

Have a good start to your evening and to your weekend.


  1. thanks joe. truly wait and see time. have a good weekend.

    1. Marc:
      A question on your diagonal chart:
      This would be a leading (A). My understanding is they are either:
      1. 5-3-5-3-5 OR
      2. 3-3-3-3-3
      If correct, then using Joe's w1 (5 waves), this implies that w3 must be 5. We only have 3. The 4th we're in now (assumed) is 4 of 3, not 4 of 5, correct?
      If so, then this couldnt be a leading d. If w1 was actually abc, then possible. But, if w1 was abc, then whose to say its w1 and not "a" (or W)? Then there is no diagonal. A move to 2601 would likely be "a" of abc to larger B.
      Am I missing something here?
      (Sorry, that was more than 1 question, lol)

  2. Being flexible and patient are the key. The bears really need to take control soon to keep (iv) on the table...

    As always, thanks for the insight. Enjoy your weekend.

  3. Being mindful of the location of minuette (1) I would suppose we are looking for a Fib relationship of c to a that is less than 1, such as .618?

  4. All the count by ET is ok, wave C within (iv) is an expandeded diagonal due to to the economic news

    1. Do you mean an expanded diagonal as a C from 2,347? It would need to go >2565 to validate which would be close to overlap minute ((i))

    2. This comment has been removed by the author.

    3. We actually overlaped wave (i), a new count is probably be needed. The expanded C diagonal, in my count, started from ~ 2.400 $ : 1 of C is at 28 of Dec., 2 and 3 on 2nd of Jan., wave 4 at the 3rd of Jan and 5th wave at 4th of Jan.

  5. Yesterday I posted a gold chart today it didn't let me down like S&P did :( Negative divergence showing up in daily S&P chart now. Patient ET says well I need a stiff drink :)
    Gold could be working at a top would need more time IMHO. Bears watching.
    Link RSI Negative and Positive Divergence it isn't Constance Brown but same info.

  6. Just out of curiosity, everyone please post a percentage, based on your opinion, if the market will hit a lower low.

    1. I will guess 75% because companies like Apple and Delta hit lower lows this week.

  7. EWO hit a new low at the recent bottom on the hourly chart(ie.. no divergence) so I favor new lows and this recent bounce will really catch the bulls.