Likely Completion of Minute ((c)) wave of Minor 2

Here's the daily chart from today. During the day, we called a likely truncation at the high, after a triangle we described in the last several posts. We waited just a few bars to see if yet a smaller degree fourth wave triangle would form. It did not. After the truncation, we were able to count five waves down, and three waves up, on the intraday chart. (Here is what that intraday chart looked like LINK. The red star is the truncation.)

S&P500 Cash Index - Daily - Likely End of Minute ((c)) of Minor 2

Notice that this minute ((c)) wave did have a divergence on the Elliott Wave Oscillator, and there is no third-wave peak on the daily chart. Because of the lower closing low, the Fisher Transform continues to confirm its divergence, as well.

SP500 Cash - Daily - Lower Fisher Transform

As can be seen from the above chart, the retracement at the end of the day was back to the lower trend line shown on the right of the chart above. It will be interesting to see if the back-test holds. What is critical is that the downward bar is clearly one of the longer ones, and that it occurred with nearly precise timing in relationship to the triangle completion.

As of the close of futures trading at 5 PM ET, both of the Dow and the Russell 2000 futures had lost their embedded daily slow stochastic readings. The ES and the NQ had not (yet).

Have a good start to your evening and to your week.

TraderJoe