The ES Monthly Chart is below. We have been counting this wave up as Intermediate (3), and it remains so. But, interested Elliott analysts need to ask the question, "what IF this wave exceeds equality with wave Intermediate (1), up? We'll, if this wave up is a Cycle V wave, we have been expecting a diagonal, up. That could still happen as a contracting diagonal if wave (3) remains less than wave (1).
Usually, in contracting diagonals, the third wave doesn't much exceed 78 - 80% of the prior first wave. But what if it does exceed equality? Then, we would simply propose that the count - while remaining the same - would simply trace out the expanding diagonal option below.
There are a couple of clues already. The first clue is that this wave (3) is longer in time than the prior wave (1). We noted this earlier in posts and comments. This fits with the expanding nature of an expanding diagonal. Second, the Elliott Wave Oscillator has lost the contracting divergence on the two-weekly timeframe. We noted this in comments.
But first, to switch to the red count, we would need to see that longer wave up. It hasn't happened yet, and like today, the market has really been playing chicken with us collapsing when it might impulse for this count.
Still, the grinding, overlapping nature of the counts suggest that a diagonal of some type is in progress. So, we'll stay with a diagonal count unless/until price dictates otherwise.
The contracting diagonal is actually the more conservative count in the short run, as it requires a much shorter wave (4) overlap. But we will still just simply follow the rules and do as measurements require. If the count requires a more dramatic dip - then so be it!
Have an excellent start to the evening, and to the holiday week if you are starting it already.
TraderJoe
yes a lot to consider... you must believe wave 1 and 3 count as ABC and therefore we are in a diagonal. this above count calls for a 30% plus loss followed by a 150% plus gain ( as waves 4 and 5 of a fifth wave from 2008). The fourth wave above would have to be >25% loss, but not more than prior fourth wave of 35% loss by wave degree? The fifth wave would likely take us to June 2028 Its hard to think this has higher proabaility than perhaps this wave extending as wave 3 of impulse. or alternatively you can already count a completed expanding diagonal with abc as waves for wave 5
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ignore the green as expanding diagonal, no overlap, but its an impulse i belive
DeleteTHX so much TJ! I have been thinking about the long term counts a lot lately.
ReplyDeleteI look at the monthly and yearly charts and it seems obvious to me that we are needing more and more drugs to get the high. We have gone from great economic growth to needing more and more credit and cheaper credit, to printed money when that was not enough, to checks literally send out to people and corporations alike.
DeleteDon't forget multiple expansion via non-stop share buy-backs in the face of declining top and bottom line revenue. A historical bubble. Looks like its demise delayed for the time being... 😊
DeleteSPY 1-hr: another new high.
ReplyDeletehttps://www.tradingview.com/x/K3sfDmH6/
TJ
ES futures have a new 'closing' high, but not a new intraday high, yet. So, there may still be more to go over the holiday. TJ.
DeleteI will take any help on this matter. I struggle with this degree labeling idea. Would it not be a problem that the (2) in the post from the 10/13/24 post would be greater in length than the circle 2. The length of the decline in 2022 has given me grief, and to make it worse, it overlapped in the dow. Thanks in advance for any help.
ReplyDeletehttps://imgur.com/fLv5zgG
You're going too far back, as I have cautioned many "not to count backwards in time". One only counts "forward in time". The last prior significant down wave was the covid low, the low of Primary ④, the immediate previous wave of one higher degree in the same direction. See Chart below on the right. As you can see, it was a -35.4% drop.
Deletehttps://www.tradingview.com/x/veV1NPyJ/
Although wave (2), see chart on the left, exceeded it in nominal points, it was only a -27.5% drop, so smaller in "log" terms. So, one could be a 'purist' and say "only points count". Or one could recognize the extreme stimulus going on after March 2020, and say, "the percentages work; close enough for government work." That's how I'm recognizing it.
TJ
Thx much for the response. This subject is on my winter list!
DeleteHappy Thanksgiving to all.
ReplyDeleteTJ, words can not express the gratitude that I have for all your teachings over the last decade and beyond.
This blog, many days, is my island in a sea of insanity.
Thank you so much and have a wonderful day!
You are very welcome BBRider & thanks for all your contributions, too! Very happy Thanksgiving! TJ.
DeleteThere is a new post started for the next day.
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