We said we were counting upward until something prevented it. Today, the ES daily futures made an outside day down, as shown in the daily chart, below, and wound up at / below the 18-day SMA. So, "outside day" guidelines are in effect (if the high of the outside day down is exceeded in the next two daily session, then it constitutes a trap for the bears).
One interpretation of the up wave is that it is a five-wave "a" wave, up. The wave is shown below with the five-count in a wedge on the ES 2-hr time frame. The chart clearly shows the reason we paused the up counting today, with two levels of overlap (L#1, and L#2) that overlapped both of the first waves up.
IFF the five-wave sequence is counted correctly, then it could be a larger a/i wave up. The wave ended with a contracting diagonal that we showed on the 2-min chart. The start of the diagonal was then exceeded lower in less time than it took to form, validating the prior structure as a diagonal. So, this down wave could be a b/ii wave down. If so, an awful lot of different structures are possible. In the case of the b wave, even a triangle is possible. It's a situation rife to trip up both wave-counters and traders alike.
The only thing that can cause invalidation of an up count once the down wave is in progress is trading below the start of the wedge. And yes, marginal higher highs could be made if b/ii turns out to be an expanded flat.
So, patience, calm and flexibility are again called for as measurements are the key at this point.
Have an excellent start to the evening and the weekend,
TraderJoe
The low at 11.18.am.cst today is not showing on spx cash charts the one pulling up from.tradeview. SPY and es shows a lower low...can that change the count. Nq and qqq not showing lower low also.Thanks
ReplyDeletehttps://www.tradingview.com/x/7q2AW2PQ/
DeleteTrue, but SPX is not tradeable, and doesn't reflect the overnight. That's why I use ES in favor of SPX, and SPY seems ok in the daytime, but you lose track of 'total trading hours' for time-degree definitions in cash. Still, NQ looks fine.
DeleteBarchart NQ Link
So, to me, looks like it amounts to nothing.
TJ
ES 2-Hr: because there is no 1.618 extension, and because a new high was not made, I think we need to be open to the three-wave equivalent count, as follows. Roberto Mattheus was following this count earlier, and it does have equivalent odds of being correct.
ReplyDeletehttps://www.tradingview.com/x/08vHEutR/
In fact - although not shown - from the low of red b; c = a, but if counted that way (as b at the low) then there is a time degree violation in the next ② vs b at the low.
TJ
Agreed I had similar thoughts and thanks on replying to above. Btw trump said he will announce more tariffs this coming week
DeleteWait I just remembered it was me not Robert who posted that count. Lol
DeleteThat was a count I had, but I'm currently thinking it was an A Wave with a B now in process. If we rally Monday to test the high again, it's likely a bull trap and we go lower for C of B rest of the week. I'm waiting until I see how Monday plays out. They could have closed below the 18ma, but didn't - which is interesting. Again, I don't like the small time frame rsi here for bears but that's me and my own trading system considerations.
DeleteThe odds are really-really close; like 55-45 of either. The only edge I see in the odds is the lack of a 1.618 for an impulse. But that just doesn't mean it's not an 'a' wave in a wedge, either. It can be the classic extended first wave count, too. Or a-b-c. We likely won't know until under the low or over the high. So, a good time to be really, really calm, patient & flexible and not lunch for the algos. TJ.
DeleteI suspect we have seen only 1 and 3 of LD so far..overnight and tomorrow should give us 5th of LD. Let's see
Delete@Jack 12:23 pm; if you mean of the down wave and not the up wave, then ok that may be possible. But so is a Flat wave, too. TJ.
DeleteA new post is started for the next day.
ReplyDeleteTJ
I see a 5 wave structure on futures in the 15 minute chart.
ReplyDelete