It would be wonderful to be able to predict the stock market with a high degree of precision. But, Elliott wave theory has several features that just refuse to pin down the market's options. One of those is "B" waves. They can be almost "any three", from a flat wave to a zigzag, a double zigzag, a triple zigzag or even a triangle. With that in mind, below is an update on the daily projection chart.
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| ES Futures - Daily Close - Actual and Speculation |
Today made a lower daily low. and it had more impressive initial statistics than the first down wave with only 173 advancing issues and 1,736 declining issues. This is now a 1:10 ratio, and might represent a "kick-off" wave. So, it does appear a correction - at least - is underway. And maybe more. Unlike yesterday, there was no big rally into the close.
The length in price of today's wave down, is also shorter than the initial leg down, and therefore, today's wave down can well qualify as a sub-wave of the next move lower. The DJIA darn well almost made a new low below the January low. The ES did not, and reacted off of the 78.6% retrace level of that January low. The down move is picking up speed and may be part of the minuet (c) wave of the minute ((b)) wave - but that remains to be seen.
From here on out, one must follow retrace levels and overlaps closely on any further the downward waves. Again, given the nature of "B" waves, we want to back-off and not try to call it too closely. Today's low did pierce the lower daily Bollinger Band, and then closed just above it. Meanwhile, the daily slow stochastic is not yet in over-sold territory. so there can easily be some follow-through to this initial move lower.
Have an excellent start to your weekend.
TraderJoe
P.S. Correction. On the day after this was written, two different sources showed the NYSE Adv-Dec figures were more like 549 / 2652. This is still in the impulsive category at greater than 1-to-4, but still not a 1 : 9, or 1 : 10 kick off. My apologies for the error. Data vendors are what they are.
P.S. Correction. On the day after this was written, two different sources showed the NYSE Adv-Dec figures were more like 549 / 2652. This is still in the impulsive category at greater than 1-to-4, but still not a 1 : 9, or 1 : 10 kick off. My apologies for the error. Data vendors are what they are.
Thanks! You seem pretty confident about (a) being done. Is there any particular evidence for (a) being done rather than being in the third wave of (a)? What do you look for to help you make that determination?
ReplyDeleteWhat did I say about "B" waves in total? Please don't put your "pretty confident" words in my mouth. There are not 'yet' five-waves-down in a channel. That's all folks.
DeleteHi ET .... from my read of Steven's remarks, and your reply ... I'm detecting a possible disconnect. I see his point of view, and yours, and from where I sit you might be addressing different questions. I think his question is reasonable, and your chart makes it clear that neither (a) down, nor (c) down, in any way 'threatens' to claim the B wave is done. Indeed, I'm beginning to wonder from my own work, if a larger correction is in the offing (still within B), but still taking an ABC form (or WXY if you like.) Unless ... you are simply noting that (a) down --- given the form you expect -- must be a five waver itself and we don't have that yet. Is that your point?
DeleteHey, guys, c'mon. There are only three waves down at this moment, and one of them is not 1.618 the other. ANYTHING can happen from here for a B wave including 1) going over the top again in a FLAT, 2) to forming a larger diagonal (a) wave down, 3) to forming a triangle. Do you get what 'anything' means? That's why the retrace waves have to be monitored. You can't get blood from a rock.
DeleteThanks ET and I hear what you are saying because it is all about the price action and retracement levels in a B wave. it would be easy to say this is impulse wave (c) of a simple zigzag ((b)) move lower but we need the price action to confirm going forward.
ReplyDeleteCorrect, kevin. Thx.
DeleteIf the "January Effect" holds sway, Friday's action suggests 2020 is going to be bumpy...
ReplyDeleteThere is a Contracting Diagonal upward in gold on the 5 minute since the point of e on the 2hr triangle. Sunday night should be interesting.
ReplyDeleteTJ, if the high was expanded B,how low can C go (worst case scenario) based on your knowledge.
ReplyDeletethanks
in terms of fib relationship and ew guidlines
ReplyDeleteIn a flat with B extended, usually C = A.
Deletehi joe
ReplyDeletein 2009 lower 666.79
en2020 higher 3337.77
weird these numbers. what do you think?
(Fibonacci) 5 x 666.79 = 3333.95; awfully close
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ReplyDelete