Monday, August 8, 2022

One Way to Count as Completed

There is one way to count the current uptrend as completed; as minute wave ((c)) of Minor wave 4. That is shown below on the ES daily chart.

ES Futures  - Daily - 'One Possible' Count Completion

In this count the entire up wave would have taken 34 trading days, and minute wave ((c)) would be inside of the 1.618 extension on minute wave ((a)), as shown.

One way to continue the count is to take the price action of the prior five days and make a larger running triangle out of it - with a more complex b wave, up. 

Note that although there is a doji candle at the high, the daily slow stochastic is still embedded. And a candle pattern is just that. It must be confirmed with a significant lower closing candle without having made a new higher high first to be activated.

Have a good start to the evening.

TraderJoe

Sunday, August 7, 2022

Coincidence or Not ?

Here are two Fibonacci time studies on the ES daily futures. The first has occurred and there isn't a way to change it. These were "high-to-low" measurements. 


This second measurement has not fully occurred yet. The study is "low-to-high" measurements. It will be interesting to see if it is close, and, if so, how close.


Have an excellent rest of the weekend.

TraderJoe

Friday, August 5, 2022

Medium Range Picture

Don't lose sight of the ES 4-Hr chart. We were expecting contact with the EMA-34, and this morning's Payroll Employment Report provided that (+528 vs +250 expected).

The red alternate count below is for the wedge count. It could still come to pass.


Allowance should still be made for a 38 - 50% wave (iv) - only 23.6% so far. Allowance should also be made for the EWO to approach the zero line again (+10% - 40%). Possibilities for wave (iv) include:

  1.  Expanded Flat
  2.  Running triangle
  3.  Expanding triangle
As usual, a larger wave (iv) would be ruled out if wave (i) is overlapped downward.

Have a good start to the day.
TraderJoe

Wednesday, August 3, 2022

Minimum Minor 4 Diagonal Target Obtained

We have showed on charts for a while now that - if the ES daily futures were to be making an expanding diagonal lower - this up wave would need to get past the minimum level of 4,168.25 (corrected). That level was marked on previous charts, and it is marked on the updated chart below. ES prices today got to 4,170 - meeting the minimum criterion.

ES Futures - Daily - Minimum wave 4 met

We now know that wave Minor 4 has both taken longer in time, and traveled farther in price than wave Minor 2. One can also see that the Elliott Wave Oscillator for wave Minor 4 is higher than that for Minor 2 - that is something I doubt anyone else told you could happen. 

Could Minor 4 be over today? Well, yes, it is possible as the wave would still meet the rules. Still, there are several ways the up wave could continue. Why? Because slightly higher prices might meet the upper descending diagonal trend line and provide a better look to the pattern. Here are the most likely options.

  1. Price is still in a b wave of minuette wave (iv) as a larger flat. Wave (v) to come.
  2. Minuette wave (iv) ended today in a triangle, and today is only wave i of (v).
  3. Minuette wave (iv) is continuing in an expanding triangle; today was wave d.
  4. Wave minuette (v) is making an expanding diagonal.
The four-block below shows some of these ideas in the order above on the cash hourly chart. 

SPX Cash - Hourly - Possible wave (iv)'s


Each of these local counts has it's own strengths and weaknesses. The one I like the least is the contracting triangle; its waves look the lesser developed. Well, this is all part of what I have termed The Fourth Wave Conundrum which happens at every degree of trend.

Of the four, it is likely that the second and fourth chart provide the wave in the wedge look that should have resulted from the extended first wave (i), and the shallow retrace following it.

Have a good start to the evening,

TraderJoe


Tuesday, August 2, 2022

Likely Wave (iv)

SPY 1-Hr: the fourth wave continued to develop today, and has at least hit the 23.6% retrace late in the day after making a near-equal high. Price is fighting a battle at the 100-day SMA on the ES futures.

SPY Cash - Hourly - Likely Into Wave (iv)

The near equal high permits a Flat wave to be constructed, and this would alternate well with the sharp second wave (ii). Locally, it would be great to see the Elliott Wave Oscillator tag the zero line - or a little above or a little below, and possibly for price to cross the EMA-34 which it has not done yet.

The daily slow stochastic remains embedded and since price is above the 18-day SMA the price bias is still said to be up.

Prices were quite whippy today in a session designed to chop accounts as much as possible. Note that as of the cash close, neither SPY nor ES made a lower low than it's opening price lows on an OHLC chart (even though that looks like the case on the close-only chart).  In addition to the Flat, some sort of triangle can not yet be ruled out until/unless there are lower lows - it just doesn't look like a contracting triangle on the futures chart at this point.

Have an excellent start to the evening,

TraderJoe

Monday, August 1, 2022

Inflows then Nothing

Overnight U.S. equity markets were lower as measured by the ES futures. When the cash market opened it gapped lower and traded lower for about an hour. Then the first-of-the-month inflows started coming into the market and the cash and futures made a new higher high. After that, the market traded sideways to lower. The hourly chart of the cash SPY is below.


After today's new high, you can observe the hourly closes just "skimming along" the EMA-13. Not even a 23.6% retrace has been made on wave (iii), yet. Because wave (iii) has not exceeded it's length criteria yet, we are either in wave iv of (iii), today, or starting on the larger wave (iv) which might be a Flat to alternate with the sharp wave (ii). The daily slow stochastic is still above the 80-level. Price settled just about dead-on the 100-day SMA. And locally, the hourly Elliott Wave Oscillator is red and declining.

Remember, this wave might form a wedge, so a contact of the lower parallel for a fourth wave might not be in the cards (but it could).

Have a good start to your evening,

TraderJoe

Friday, July 29, 2022

Closer Still

At today's high of 4,144 the ES futures got closer to the target level for Minor wave 4 in an Expanding Diagonal count. Here is the daily chart updated for the new prices, and to show some levels.


We will note that minute ((c)) = 1.618 x minute ((a)) does get prices to the target area. Further Fibonacci expansions are possible too, such as ((c)) = 2.00 x ((a)).

Remember, Monday is the first day of the new month with potential inflows from pension funds, 401k's, company bonus plans, dividend reinvestment schemes, etc.

As always, diagonals are lower probability patterns that must form correctly in every detail. Importantly, the Minor wave 2 high may not be crossed or that would be an invalidation of the pattern.

Have an excellent start to the evening and the weekend,

TraderJoe