ES Daily Candle: Higher High, Higher Low, Higher Close: Doji Candle
Market Posture: Neutral-to-Negative
Daily Swing Line: Higher
Daily Bias: Up (Settle Above 18-day SMA)
Resistance: Upper Daily Bollinger Band
The overnight futures and the cash market made a new higher high, then the futures could be counted as five-waves, down, which was done in real time today. On a short term basis, the ES half-hourly chart looks like this.
 |
| ES Futures - Half Hourly - New High and Five Down |
The channel was broken lower, and the down wave is longer than ((2)) in price length. So, a new location for ((4)) would be the alternate only at this point or it would seem to violate degree principles.
As per the discussion yesterday, the daily chart looks like this with an extended first wave of a. This is the only way I can see to keep the degrees of the waves correct relative to each other with the waves made so far.
 |
| ES Futures - Daily - Extended First Wave (x1) |
And, as long as the channel is holding, it is also the only way I can see to keep all of wave 3 above a line from 0 through 2. If wave 4 is beginning, it could take the form of a zigzag or a triangle - and the triangle 'might' be more likely over the holiday. (Please note in the bottom chart I just used some relative wave symbols to clarify which waves are larger. Wave iii from the upper chart is wave 3 in the lower chart.)
Remember to check the exchange schedule for trading hours during the festivities. Get some rest, have some fun & enjoy the holiday!
TraderJoe
Let me be the first to ask a "stupid" question on this post:
ReplyDeleteIf we have 3 waves up (in a channel, suggesting corrective), could this not be an abc forming the Y leg of the WXY from last Dec? I realize that the "c" leg is just shy of "a" x .618, and that Y would be just shy of W x .618 (at this point). Would this be part of the reason?
Thanks for your patience.
Sorry, forgot to specify that Im looking at cash SPX.
DeleteThanks
The only issue with it is - as I clearly pointed out over the weekend - that one would be saying that a market top was being formed without a divergence on the NY advance-decline line. That would be a rarity.
Delete>a market top was being formed without a divergence on the NY advance-decline line. That would be a rarity.
DeleteWhat about if this isn't THE top, rather a w4, with w5 up yet to come, which will then be THE top, with divergence.
...or if it's just part of 'a', and there will be a 'c' after it which is the top.
Deletealt count looks better - just look at NYA - just (or just about) finished 4 from mid last week
ReplyDeleteLarger uptrend intact as market is clearly consolidating recent gains. Minutiae sometimes causes myopia. The turn, when it does finally arrive, I suspect will be quite unmistakable and trying to call tops will lead to great frustration imho..
ReplyDeleteIsn't that the interpretation of iii? - that there are higher highs after it? And isn't that the interpretation of 'a'? - that there should be a 'c' after it? And isn't that the short term interpretation of the daily slow stochastic is still embedded, and price has not closed over the upper Bollinger Band? So, I fail to glean the value in the comment.
DeleteWhen the market turns for a correction or decline at the anticipated degree, I believe the reversal candle will be evident on a DAILY time frame. Counting intra-day five wave declines is imho a complete wsste of time. How often do these have to be negated to make that obvious?
DeleteBTW, my comment wss intended for people suggesting a top was already notched...
DeleteAny thoughts on CL here? One of the main leaders in the ramp over the last month has been basic materials, which tbh looks like a nice buy across the board (see XLE). The last one to join the rally of 2019 basically.
ReplyDeleteI have absolutelty no confidence in my own ability to reliably count EW waves.
ReplyDeleteWith that caveat, the overall pattern seems to point to at least one more wave up. Absent a VIX gap higher, downward counts imho unlikely to be proven incorrect. 3200 will fall impulsively on any initial wave down after a top imo, and 3100 should follow shortly (one or two sessions at most)
Tachyon, there's someone on another EW forum that has had 3245 SPX minimum target since the Dec low. It sounded ridiculous at the time, but here we are.
DeleteHe thinks we've topped short of it, or the upside is very limited now. But he's only expecting a 250 point drop.
It sounds like you are still in the B wave camp?
For the longest time I remained convinced the move up was corrective owing to the persistent momentum divergences. The move past 3060 gave me some reason for uncertainty about my long term projection. I have to say I am truly amazed at some EW analysts who have been calling for a top just about every week now for the last seven months. I was once advised that although the literature does not specify it, a B wave count should be discarded at greater than 2X wave A. My view remains that price action continues to be driven primarily by CB liquidity and that they have the ability to negate legitimate EW counts, which is why so many analysts have been so wrong about a turn. The only reliable gauge I have found as a trader ( not an analyst!) has been price action around round numbers. Wrong or right, I expect the next decision point to be 3300, unless 3200 and 3100 are BOTH taken out on high volume. Just my two pence Izard...
ReplyDeleteSorry for the off topic request, but do you have a book about "Divergences" you think is worth to be read?
DeleteI am asking both Tachyon and Joe.
Hi John. The three I find the most helpful are PPO ( price percent oscillator) NYMO (NYSE McClelland Oscillator), and NYAD ( advance decline line). Most charting platforms will give you these indicindis. Edwards and Magee's work on the subject is also good reading imho...
Delete@John: It is difficult to see how the subject of divergence would warrant a whole book. Neely makes 'little' formal reference to divergence that I can find. Frost & Prechter discuss momentum divergence only 'loosely' as did Elliott, but they do say it is a part of the wave principle. It is Bill Williams who best quantifies the use of divergence in counting waves. Several technical analysis books discuss divergence and it's use using MACD, or RSI, and some with slow stochastic. Most use daily charts as the minimum time frame, since they are trying to incorporate opinions from around the world in their analysis. Intraday, consistent votes from 'around the world' are chopped into various inconsistent time frames (i.e. the last hour of the U.S. session market participants from Asia are largely gone as they sleep).
DeleteWave counting on a intraday basis is not necessarily to find the last-of-the-last divergences. Rather, it is trying to ascertain what wave counts are logically possible, and which can be ruled out. Certain critics call this "top picking". They just do not want to "get" that the larger count must be made up of logically consistent lower degree waves. In many, many cases when some people might think there is a "top", Elliott wave actually says, "wait a minute: is there a final triangle or a final diagonal?". In other words, it is Elliott Wave which is arguing for a time extension of trend, as a diagonal or triangle where others are picking a top based on technical indicators like divergences. That was my posture in October 2014 - May 2015 which some readers here might not recognize. It is what allowed me to call a six month ending diagonal into the May 2015 top. That was also my posture in May 2018 to October 2018 when a larger Elliott Wave service for 'the' major top in only January 2018 - as the end of Primary 5. I said, "not likely; there is no final triangle yet, and there is no diagonal". Both the triangle and diagonal occurred in the final analysis. Not only was this information documented on my blog, that major Elliott wave service was written to at the time, and they documented the arrival of my letters.
Now, my posture is "there should be a countable Y wave, that aligns with the W wave", as others have called for a depression-like down wave. Again, one major wave service called for that to begin in April. It is now December. I documented options as to how that could happen differently on this blog - again with a potential X wave triangle - which did occur.
BTW, a corrective decline of 250 makes nosense to me personally as I would expect the 200 DSMA to provide strong support, unless of course the upside 3245 -3250 target is met...
ReplyDeleteJoe,
ReplyDeleteMerry Christmas!!!
Same to you, David!
DeleteFirst, Merry Christmas to all!
ReplyDeleteI want to be sure Im thinking correctly (long term chart). The following chart poses several questions regarding what might be expected going forward. I want to be sure Im looking at this correctly. Thanks in advance for comments.
https://imgur.com/ayuF5hg
grr.. A,B,C need to be of the 'same degree' as (1)-(5) based on the size of the waves. I have covered this in multiple posts and in the weekend video. They are (A) and (B) at this point. No sign of (C), yet.
DeleteThis comment has been removed by the author.
DeleteAh, I think I follow on the labeling. They are the same to keep the next higher degree the same for each (ie (1)-(5) could be larger 3, and (A)-(C) could be larger 4?) I hope I have that straight.
DeleteI would hope to have the questions I posed addressed also, as that was the purpose of the post. When time permits. Thanks.
let me see if it works
ReplyDeletecan you please help with the oil count when you have time- its very confusing. Sir
ReplyDeleteI'm happy to share my experience so far in trading binary options.
ReplyDeleteI have been losing and finding it difficult to make profit in trading for long until i meet [Robert Seaman] who help me and gave me the right strategy and winning signals to trade and also i was able to get all my lost fund back from greedy brokers through Him. now i can make a profit of 12000USD weekly through his amazing masterclass strategy feel free to email him on: Robertseaman939@gmail.com or WhatsApp: +44 7466 770724