The ES (continuous futures) contract have 120 candles on the two-weekly timeframe shown below. The three measurements we'd like to refer to are below the chart.
The three measurements are these:
- Price is beyond the 1.618 external retrace of (2)/(B) on the left.
- Price is beyond 78.6% of (1)/(A) in the middle and may be nearing equality.
- The EWO made a higher high of 711 in this wave compared to 695 previously.
Therefore, price is beginning to lose the measurements of both a contracting diagonal and a (B) wave in this cycle. Nothing is impossible. They both could still occur, but the odds are getting lower and lower with each passing marginal new high. The "and then some" is that the up wave since Oct 2022 is also longer in time than the wave up to the Jan 2022 high.
Therefore, The Principle of Equivalence takes over, and the wave labels for the three-wave sequence are now (1)/(A), (2)/(B) and (3)/(C). Yes, it is possible an even larger diagonal fifth wave will form from this mess, but there would likely be a 62% or greater retrace of these waves if that were to occur. But, for now, we are working on the channel count until we can not.
Once again, nothing to the downside will surprise us, but the grind continues until it doesn't. There is a lot of room for pullbacks but, at the moment, there is no daily or weekly signal candle. So, we'll continue count following the rules and The Eight-Fold-Path-Method until there is some downward length to work with.
Have an excellent start to the evening and the weekend,
TraderJoe
im looking at that chart above along with the longer term count. both the 1 and 2 above are larger and take more time than the higher degree1 and 2 for the white count. Doesnt that mean we need to use the green count with wave 3 beginning at covid low? the subwaves of 5 seem bigger than the higher degree waves.
ReplyDeletehttps://postimg.cc/YGPbtKZT.
No, I don't think so at all. If you are referring to log scale, then as long as ③ was longer than ①, then 'by-the-rules', ⑤ can be 'any' length.
Deletehttps://www.tradingview.com/x/1zv091Gu/
On 'log scale' no downward correction has surpassed the GFC yet, so I don't see a degree problem. Further, within ⑤, wave (2)/(B) is less than the log price length of the prior wave ④.
TJ
On the phone all weekend, does this pass the EWO sniff test?
Delete@BBRider .. no, not the EWO smell test, the PPO smell test. Note when using log charts, from Investopedia,
Delete"How the Percentage Price Oscillator (PPO) Works
The PPO is identical to the moving average convergence divergence (MACD) indicator, except the PPO measures percentage difference between two EMAs, while the MACD measures absolute (dollar) difference. Some traders prefer the PPO because readings are comparable between
assets with different prices, whereas MACD readings are not comparable. For example, regardless of the asset's price, a PPO result of 10 means the short-term average is 10% above the long-term average."
The PPO might better be used over periods long than 5 - 10 years, when the % change is being measured, and particularly when inflation is raging.
TJ
Thanks for the info. This will be going into my trading folder.
DeleteThis isnt personal it's trying to be objective. Yes, wave 4 is less than the c wave of larger degree abc. But the subwave of 5 is then larger than the b wave before the 2008 crash. The channels on your chart following 8 fold path are where you would draw them for my count (connect 0 2) and would show if you drew the 2 4 line parallel on 3 that wave 5 should be completed. There's a lot going on that perhaps that's a new problem child. Time will tell. There's more than enough here to be suspicious . What's the maximum allowable size of wave i of 5 ? Iny opinion I'm seeing something that's predicting longer and higher than most people expect.
Delete@marc & BBRider .. see the next day's post which is now online. Thx.
DeleteTJ
C = W,X,Y,X,Z ? Thanks TJ
ReplyDelete'possible' in a large triangle or something like that, but entirely speculative and insufficient overlaps to cement that case. TJ.
DeleteBtw Yom Kippur starts tonight. The holiday does have some interesting market history attached to it.
ReplyDeleteThanks TJ!
ReplyDeleteOpinions on this ext ((1)).
https://invst.ly/16sxnw
No overlap btw ((1))/((4)).
Momentum diverges.
Alternation btw ((2))/((4)).
Not related to ew but wouldn´t be less likely that the euro crisis and pandemic is of the same degree? This count has the euro crisis and China crash both one degree lower, which seems more reasonable imho.
Also the net distance and time factor of the corrections also fits "better" with ext ((1))..?
Deletehttps://invst.ly/16sxpq
That last chart has been my thinking for a while. Thx for posting.
DeleteThoughts: 1) Not impossible. Never said it was; 2) But why would 5 be 'longer in time' than 3? The usual order when wave one is the extended wave is 5 < 3 < 1 in price and time; 3) It's a good count unless/until the current wave exceeds 100% of the prior wave. The essential problem is we don't 'yet' have a stopping point; 4) Usually, 'most often' in the extended wave one scenario waves three and five 'diverge' on momentum. But the justification you are using is that there is a 'new higher high' in momentum. That would be 'atypical'; 5) By the Principle of Equivalence, it is impossible to distinguish between your ① wave, and a similarly sized (A) wave with 2018 - 2020 being an expanding triangle (B) wave and Jan 2022 being (C) of a Primary ① top of a contracting diagonal overall. The chart below just 'illustrates' that idea. I'm not saying I'm endorsing it.
Deletehttps://www.tradingview.com/x/wqCXw9HO/
Notice that the extended one count calls for an "immediate" retrace of 38.2% back to the 2,550 level 'at minimum. I can't as yet even get a retrace even overlapping the prior high!
Further, there are still ways we can get Primary ⑤ at the Jan 2022 top, and then a triangle for SuperCycle [IV].
https://www.tradingview.com/x/pvp66PC4/
Just because we are beyond 1.618 doesn't mean too much, yet, IFF a triangle is involved.
In short, the legitimate counts at the moment are slightly confused until we get a stopping point. Remember, the NDX 'already' has a longer wave up which would likely invalidate the extended ① in 2018 count.
Those are just some thoughts - feel free to debate.
TJ
I would think any triangle for [IV] will have a much more horrendous A wave to start it off.
Deleteme too .. just an example & see tomorrow's post. TJ.
DeleteGood point. After all the A wave "should" represent the deepest retrace and to get anywhere the 4th wave of one lesser degree it would have to be a monster, with 3 of A being the most violent if what would be a multi- year correction and occurring at its start.
DeleteEribo if ur chart is right..6000ish is the upper limit..we are getting there and election/new govt is on the horizon
ReplyDeleteWas thinking all weekend that that wave after covid is not shorter than the wave up to 2018, I'm sure I checked it. I have the same looking count but its not an x1 from 666.79.
ReplyDeleteThe spx numbers are 2274.12 for wave 1 and 2626.76 for wave 3. I will post some charts on the new post.
Check the new post before doing a lot of work. It might save some time. TJ.
DeleteA new post is started for the next day.
ReplyDeleteTJ