Thursday, November 7, 2019

Over 3,079

U.S. Debt Clock: $23.02 Trillion; prev $23.02
ES Daily Candle: Higher High, Higher Low, Higher Close: Spinning Top Candle
Market Posture: Neutral-to-negative and Probing
Daily Swing Line: Higher (Higher High, Higher Low)
Daily Bias: Up (Settle Above 18-day SMA)

In our Tuesday post, we said that if prices got up over 3,079 that the assumption of a fifth wave in progress was more tenable. We also said on Wednesday, that all the wave sequences did line up that yesterday could be only the minuet (b) wave up - but time was out. The two are mutually exclusive. The overnight tariff news took prices up over 3,079 and made an up wave that consumed more time than a minuet (b) wave could be allowed. The short term count required revision. The longer term count did not.

Here is the weekly chart with the potential levels for the Intermediate (B) wave of 1.27x (A) and 1.38x (A). Price popped the top of the upper trend line this week.

ES Futures - Weekly - Two Key Levels

On a daily basis, price ran up to the upper daily Bollinger Band at 3,097, and then started to sell off a bit, as you can see from the daily chart, below. From this chart, there has not yet been a single day close above the band.

ES Futures - Daily - Tag of Upper Band

The daily slow stochastic is still embedded, and price is still above the 18-day SMA. There is still no full-on reversal candle. Also interesting, no significant trend line from the October bottom low has been broken. Based on measurement, the count revision that makes the most sense, is the one in the four-hour chart, below.

ES Futures - 4 H - Nearing ((c)) = ((a))

It has been a bear of a count - one filled with trips and traps. For example, the potential expanding triangle shown in yesterday's minuet (b) count did not predict the last wave in the sequence to follow it. Therefore, it must simply have not been a triangle at all but the series of higher highs to make the first impulse, minuet (i) of minute ((c)). Nothing in the above chart says minuet (iii) of minute ((c)) is conclusively over yet. It missed a critical overlap by just 1 point today near the close. But, it could be over, and if it is, so be it.

P.S. I have tried counting as a pure impulse, and the middle wave winds up being "too short" as of today. Also, there is no 1.618 wave following the ((a)) wave.

So, the primary thing to note from the count is that this latest up wave is approaching ((c)) = ((a)).

Have a good start to the evening - and still - remain flexible, patient, and calm.
TraderJoe

32 comments:

  1. hi joe thank you for your work.
    the end of the wave (B) arrives in how long?
    your opinion thank you

    ReplyDelete
    Replies
    1. .when the wave count reaches a (v), up. Not before.

      Delete
  2. Love following and learning from your feed!

    Is there a reasonable chance that there is a subsequent X wave and Z to finish (B)? Especially if Y doesn't reach 1.272 or 1.382 x (A)?

    ReplyDelete
  3. Bullish count no ... Interesting

    ReplyDelete
  4. $NYAD is finally showing a tiny bit of divergence.

    ReplyDelete
  5. Here's what I have so far this morning. Wave (iv) could be done as a sharp. Could also be part of a triangle over the weekend.

    https://invst.ly/oifb8

    TJ

    ReplyDelete
  6. Move down looks corrective so we should see some kind of C down and a final fifth up per T.J's most recent chart.
    We hit an important fib number yesterday so market could eke out a double top via a truncated fifth or marginal new high. Things are gonna get ugly....

    ReplyDelete
  7. Here is a further update. Notice how the flat correction is used to help insure the down wave takes more 'time' than the up wave. As it was, wave a, down, was 'too short in time' to correct the entire movement. Now expand that concept to the larger weekly market count.

    https://invst.ly/oigx9

    TJ

    ReplyDelete
  8. Down wave did not consume as much time as a second wave should have, and is likely now a B wave. Upwards, we have crossed the first warning for a triangle. Don't be surprised if things get whippy in the low volume. A larger leading diagonal .a wave up is possible.

    https://invst.ly/oiht0

    TJ

    ReplyDelete
    Replies
    1. now have downward overlap on the upward A wave.

      Delete
    2. Here's a further update based on the overlap. Nothing says v down is over yet. Downward structure can be expanding diagonal.

      https://invst.ly/oikdi

      TJ

      Delete
    3. Here's a further update: the vth wave made a lower low, and is now longer in price and time. IF it's to be a leading diagonal, the high may not be exceeded. Otherwise, it might be an 'x' wave.

      https://invst.ly/oiks4

      TJ

      Delete
    4. ..now up over, upper diagonal, or x, trend line

      Delete
    5. breech of upper trend line ..

      https://invst.ly/oil35

      TJ

      Delete
    6. ..the high has been exceeded, making it the 'x' wave; triangle became a bit more likely.

      Delete
  9. Replies
    1. target of the next wave in the potential triangle is in my 3:40 pm post today.

      Delete
  10. New multi-month divergent low in VIX...a big move coming...what direction..?!

    ReplyDelete
  11. Translating today over to the SP500 5-min cash chart - here is what today's movements likely mean. The ((C)) wave down of the 'a' wave of the potential triangle was a very nearly precise ((C)) = 0.618 x ((A)), down.

    https://invst.ly/oim1z

    TJ

    ReplyDelete
  12. Very rare futures gap during cash session. A sign of clear desperation imho....

    ReplyDelete
    Replies
    1. What's going on is at 10-minutes before the close, Interactive Brokers sends out notice every day, that unless smaller traders can cover their margin, they will begin from then to the close to have the trade desk take them out of their positions.

      You can read this far down on the Interactive Brokers web-site.

      "IB calculates SMA in real time throughout the trading day but...
      ...only applies the Regulation T initial margin requirement to securities at the end of the trading day (3:50 PM).:

      TJ

      Delete
  13. B wave would have to retrace 90% of A around 3095...would be interesting to see if target met prior to cash session close...

    ReplyDelete
  14. Cash stopped just shy of 78.6%, upwards. Not sure what futures will do.

    ReplyDelete
  15. Yes, most interesting...VIX gapped up off the low as well...bull trap?

    ReplyDelete
  16. There is a new post for the next day.

    ReplyDelete