Thursday, September 12, 2019

Discount Double-Tweet

U.S. Debt Clock: $22.56 Trillion
ES Daily Candle: Higher High, Lower Low, Higher Close: Trend Candle
Market Posture: Neutral and Probing Waves
Daily Swing Line: Up (Higher Low, Higher High)
Daily Bias: Up (Settle Over 18-day SMA)

Yesterday, at the end of the day, we said we had run into "a monkey wrench" counting a fifth wave, and had our eyes on the ECB meeting results to be announced this morning. Draghi dumped a whole pile of cash into the system, with a lowering of the key rate further into negative territory, at -0.5%, and with re-implementation of QE to the tune of €20 billion per month as he retires.

U.S. stock index futures anticipated it over night, ran into the upper daily Bollinger Band, traded higher on fake tariff news, sold off on retraction of the tariff news, and then bounced around with some indexes making marginal new intraday highs - before closing off of the highs. At the end of the day, the slow stochastic of the daily ES chart (below) remained embedded. The 18-day SMA had a confirmed bull cross over the 100-day SMA.

ES Futures - Daily - Slow Stochastic Still Embedded

AAPL stock opened higher today and closed lower, after making at least part of a throw-over of it's potential diagonal trend line.

AAPL - Daily - Part of Throw-Over of Diagonal

Please remember that all potential diagonals can also be their triple zigzag counterparts (w-x-y-x-z) as three upward zigzags are clearly required in every diagonal, and, so, there is nothing that rules out AAPL as an Intermediate (B) wave higher. But, the chart is interesting, and for the diagonal (v) would need to remain shorter than (iii).

Neither the DOW nor the S&P closed their daily gaps from late July. The indexes are trying hard. For those of you who like such things, here is an exercise in Fibonacci, which I found interesting on the Dow half-hourly chart. So far, no one else I know of has mentioned it.

DJIA Cash Index - Half Hour - Two 1.618 Waves

In the chart, a wave ((v)) is very nearly 1.618 x ((iii)), and ((iii)) is almost exactly 1.618 x ((i)). And wave ((v)) is greater than wave ((iii)) which is greater than wave ((i)), and wave ((iv)) overlaps wave ((i)) and is longer than wave ((ii)) without traveling below the low of wave ((i)).

Predictable? Not so much. But, expanding is the mode the ECB went into today. Will the U.S. FED, which was the last to cut interest rates, follow suit next week? Time will tell.

Have a good start to the evening,
TraderJoe


27 comments:

  1. I think the most interesting thing technically about today was the gravestone Doji candles on US cash markets. Bears need to confirm this set-up, while bulls need to push to new all-time highs to prevent this potential big bear win.

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    1. @Kevin, you are misusing the term "gravestone Doji" which has a close at the low of the day. Today was nothing more than a "long-legged Doji" according to the ChartSchool at Stockcharts.com but the point of candle confirmation is a principle I respect.

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    2. If we get long red candles tomorrow following today's doji and yesterday's long white candles, these markets complete Evening Star candlestick patterns. That would be the best bearish confirmation you could get.

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  2. Many individual large caps I monitor still have intact bear counts with no 90%+ retracements from Jul highs like indexes and ETFs did. SPY actually made a new intraday ATH. Maybe the big daily ED count is in play for indexes.

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  3. In order for the AAPL triangle to prove itself, AAPL needs to drop to $140 in 10 months or less?

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  4. My 60 min Algo is going to the sell side

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  5. Maybe I have to much free time lol..I believe the diagonal ET pointed out on AAPL is correct, and that tech sector (XLK) and NDX100 is doing the same. But not DOW and SP500, which is doing a tripple ZZ, only way to meet degree rules imo.
    https://invst.ly/c8ywv
    https://invst.ly/c8z3s

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    Replies
    1. Thanks, all opinions/views are welcome, if we can rule something out that's great.

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    2. Erik -

      Interesting POV, it helps looking at other indices. That said, can you provide this in a log chart and apply the 8 fold method to confirm an impulse? On a log chart, without making the lower low during 08 crash, this chart looks so much more like an ABC since the 2002 bottom.

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    3. TJ -
      Yes very useful especially when one has several alternates to deal with.
      I agree with the log point of view, it looks better as ABC, or 123. Either way I "believe" NDX did it's bottom in 02, after all the financial crisis came from problems like securitization within the internal banking system.

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  6. Short term wave counters on the 5-min ES might like to watch a formation like this. I 'can' be allowed to fail if it is a 'c' wave.

    https://invst.ly/c91b0

    TJ

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    Replies
    1. ..as far as I can tell, above ES 3,0212 without a lower low, first, would constitute a failure.

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    2. ..there's the lower low, below 3,007, no failure; now ((5)) must remain less than ((3)) for a C wave lower.

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    3. ..that means ((5)) should not travel below 3,002 to maintain a diagonal.

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    4. here's an updated chart

      https://invst.ly/c91lx

      TJ

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    5. Now trading up and over upper diagonal trend line. Low of day 3,003.50, within diagonal parameters. Chart update below.

      https://invst.ly/c922a

      TJ

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    6. ..watch it very closely as measurements show that the length from ((2)) to ((5)) is also less than then total length of ((1)), which 'could' make the last low a ((3)), instead. A higher high should alleviate that concern.

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  7. maybe diagonal terminal on top
    https://invst.ly/c92ap

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  8. A new post has been started for the next day.

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