How do you like them apples? Or Odds? You see right now, the daily ES has a pattern whose wave sequences 'might' be able to all be counted as 'three-wave-sequences'. The daily ES chart is below.
So, the odds are roughly 50-50 that there is a break upward out of a triangle, or a break downward into a diagonal. Even if you're a decent wave counter, the roughly equal odds give one a pause regarding action to be taken - at least until things become a little clearer.
It is often said that "a triangle represents either indecision or a balance of forces". Well, so be it at the moment.
Tomorrow morning's Payroll Report and Unemployment Report would have to take out some significant lows or highs to make the wave count more apparent. Maybe they will. Maybe they won't. Time will tell. It seems curious after months and years of counting waves to be in this position, but here it is. We can still count the innards of a downward diagonal. And we're not oblivious to the shape above as a possible triangle or the fact that we are soon going into a major holiday weekend. So, there we are.
While I'm on the subject of odd, or odds, I came across this peculiarity when measuring some waves in the SPY today.
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| SPY Cash ETF - 1 Hr - Boomerang of Rebalancing Candle |
It turns out if you clone the length of the candle that was involved in Russell rebalancing and just add that distance to the bottom of the next candle you get a perfect length match, upward as shown by the blue boxes which are copies. It's almost as if someone's ETF boss said, "look, you broke the damn thing, now fix what you broke." You don't think those kinds of shenanigans really go on, do you? Well, I do, and a whole lot more.
One other minor thing. Of course, that SPY candle breaks the definition of a contracting daily triangle because it made a lower low. But it does so only for the SPY. The other products (ES futures, SPX, etc.) seem fine. Oh well, odds are odd.
Nothing to the downside will surprise me. The volatility is frustrating. They ain't making it easy.
Have an excellent start to the evening,
TraderJoe
Thanks Tj. Payroll expected to be lower than May.
ReplyDeleteES/SPY (CFD) 30-min: on the half-hour chart, another plausible triangle. Watch the low of the ((e)) wave; circle-e.
ReplyDeletehttps://www.tradingview.com/x/5Pxx433I/
TJ
Note: CFD and SPY (cash) have formally invalidated their downward diagonals. ES futures would need a few points yet. TJ.
ReplyDeleteNor Nq.
DeleteES/SPY (CFD) 30-min: reminder of the intraday wave-counting-screen. A wave-counting-stop has been placed at the likely ((e)) wave of the triangle. IT's OK, so far.
ReplyDeletehttps://www.tradingview.com/x/ybZbDaoK/
After one close outside the upper band, there was a close inside the band resetting the number of consecutive closes. Intraday slow stochastic is over-bought.
TJ
wave counting stop exceeded lower. The smaller triangle and pop-out of it 'should be done'. BUT...
Deletehttps://www.tradingview.com/x/2cjl0bo2/
TJ
BUT...watch close below18 sma:)
DeleteBUT ... reminder that today is scheduled as a shortened Globex holiday session and ends at 1:15 PM ET (12:15 PM CT). TJ.
ReplyDeleteSorry, the above information is incorrect. My broker actually provided the incorrect information. According to the CME page, it should apply to 3 Jul, not 2 Jul. These products still appear to be trading. Once again. Sorry. TJ.
DeleteSPY 2-hr: 'maybe' a much larger expanding diagonal works in the SPY as 3 > 1, as below. This is subject to the clear invalidation point, shown.
ReplyDeletehttps://www.tradingview.com/x/4OGvNDWf/
TJ
..oh, and 4 just snuck in as > 2, by a point or so. TJ.
Delete7492 overlapped. As s rile does wave 5 of contracting diagonal lower take less time than 3? Also Es and SPY 3rd wave not matching on dates. Is this acceptable?
Delete@manu; no as a 'tendency' the waves in an expanding diagonal expand in time (take more time) as they proceed along. Wave 5 usually takes the most time, Wave 3 the next most time, and wave 1, the least time. But 'time' is currently a guideline in the wave principle, or a 'tendency' and not a 'rule'. TJ.
DeleteES just broke the overnight low of 7,520. TJ.
ReplyDeletenow the CFD, too.
Deletehttps://www.tradingview.com/x/igwjJdiy/
TJ
ES below 7,506 needed for outside day. Currently at 7,509. TJ.
DeleteTo compensate for the lower low in spy and bring everything in sync for sp shouldnt triangle breakdown to lower side
ReplyDeleteIt's a possibility, and getting better as a probability, with the lower daily lows. But, it's not a certainty. TJ.
DeleteI thought the first leg down from the ath was a 5.
ReplyDelete...ambiguous? TJ.
DeleteNope
DeleteMarkets closes and es at 7565
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ReplyDelete
ReplyDeleteHello TJ. I am now in my 9th decade, and until just the other day, I have not bought or sold stocks since the early 2000's when I was experimenting with swing trading in a Roth Ira. When I stopped, I held on to a small position in SNDK which was later purchased by WDC around 2016. I hardly gave it a thought until I heard that WDC had reissued SNDK and that i now had small positions in both. I've been following and apopreciative of your teachings for quite a few years now because of a growing interest in EW Theory. The other day I thought that SNDK was approaching the end of wave 5 of III, and when it gapped up on the 26th, I sold premarket a bit lower than the high and have been watching the somewhat volatile retracement since with thoughts of taking a position again. Doe you have any thoughts as to how complex the wave IV might become? It is now at the bottom of the channel. Thanks for all your work, and generosity.
I've tried to post a link to the TradingView chart, but for some reason it defaults to spx chart when I paste it.
This comment has been removed by the author.
ReplyDeleteThis comment has been removed by the author.
ReplyDeleteChart for above:
ReplyDeletehttps://www.tradingview.com/chart/JEHoYJNI/?source=promo_go_pro_button