We Tried to Prepare You

On April 28th - over two weeks ago - our post clearly indicated how "Sentiment Soared" and we asked, "who is drinking the Cool-aid now?". Then on May 13th we clearly stated in regard to the triangle count, "The immediate implication of a vth wave up (especially if it results from v = i), would be that a minute ((c)) wave down should occur as a five-wave sequence to end Minor 4."

Then, on Monday of this week we said, "Just keep in mind, the likely (now validated) triangle, and the deep nature of the Dow's wave iv both suggest a loss of momentum, and may be occurring just prior to the last wave-set upward. And keep in mind - since we are likely dealing with a pesky overall ((b)) wave higher - there would be nothing unusual if a truncation occur at or near the top since we are likely in a fifth wave already now." (Underline emphasis added.)

And with those quotes in mind, here is the update of the ES E-Mini SP500 Index 4-Hr chart.

ES E-Mini S&P500 4-Hr Chart Upward Count Completed

And it should be clear, that we are most likely in the minute ((c)) wave down of what will likely be Minor wave 4, on the daily chart.

So what about that Dow? In live chat we clearly indicated the truncation count in the Dow. It did fail to make that 90% level by just a few points, but, in our count, it does have five-waves-up, overall and we did provide a warning to you to expect just such a truncation in a squirrel-ly ((b)) wave count. And certainly, neither the S&P500, the ES, the NQ nor the Russell missed the 90% level - with them making new all-time highs.

DJIA 2-HR - Truncation in the Minute ((b)) Wave Up

We note now how devastating the decline is now that the market algorithms are on a "search and destroy mission" to fill the gaps.

We urged caution, patience and flexibility. We still do. Whippy market behavior is still expected as the $VIX is back up over the 15 level, today.

Take care, and have a good night.
TraderJoe