Thursday, February 27, 2020

Take No Prisoners

The chart below was shown several times before. I do not have too much more to say about it at this time.

ES Futures - Monthly - Back Into Diagonal

What I will say is the down move is starting out like a diagonal retrace. If that continues remains to be seen. The shorter term hourly chart is below. Yesterday I said, quote, "It would be wise to see if the market can make a new bottom, and then cross the upper channel boundary as better confirmation that wave 2 is underway."

Crossing the upper channel boundary never did happen. Today, prices were confusing in both directions and literally sank into the close and into the after-hours. The reason they were confusing was that they contained failure waves (upward) - always difficult to deal with.

Overnight and this morning, blogger BBRider finished a count of a downward diagonal. During the day (in the heat of battle) I said that count could work, but I also said, unfortunately, a 1,2,i,ii lower could work.

ES Futures - Hourly - Below Base Channel

While I initially discounted the 1-2-i-ii for measurement reasons, again in the heat of battle, on review, this count has better proportions overall.

Please note there are fewer candles in the second ((ii)), than 2, and the net distance traveled is less. Further (b) of the second ((ii)) is shorter than ((v)) of 1. The charts are very, very messy with truncations and flat waves.

Again, let me say that upside counting will not resume until this hourly channel is breached to the upside.

Have a good start to your evening.
TraderJoe

88 comments:

  1. Here is the larger diagonal. Good till 2920.25

    https://imgur.com/2bAYCtj

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    Replies
    1. The EWO broke its divergence on Wave five versus three. That's a 'no go' for me.

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    2. Would agree, just noting it as still valid and maybe that was the capitulation puke fest at the end of the day. We shall see. Learning a lot on this wave for sure!

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  2. https://i.imgur.com/me4K7tV.png

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    1. So, your upward count of a non-overlapping a,b,c,d,e shows me you have no familiarity with Elliott wave. Any future charts will be deleted until you have shown you can master the basics.

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  3. ET regarding the flat B count, if correct, then we need to start think about the degree relationship btw A and C since this C now is approaching 78.6*A
    https://invst.ly/pzmer

    But(!) there isn't that much room for 1 of C to form without being bigger than all of A..
    https://invst.ly/pzmfz

    Maybe this means that this 1 is the extended wave of C with the shallow pullbacks OR simply that the ending diagonal count is correct and it actually isn't a C wave.
    https://invst.ly/pzmh4

    Thanks !

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    Replies
    1. As far as I can tell, the down move is currently too fast for a C wave.

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    2. What happened to the A/D divergence?
      Are you sure that long lasting bear market starts with explosion burning the fuel in the first week?
      The bull market is not over.
      That is exactly how C should start the right length and time.
      Great theory knowledge poor ED pattern.

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    3. 'As far as I can tell, the down move is currently too fast for a C wave." what does this mean specifically?

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    4. When you have an A-B-C Zigzag, downward, then "most-often", not always, the C wave travels at a slightly more shallow "angle of descent" than the A wave. The reason for this is that "its lack of momentum" is telling you the upward pull of the market is greater, and to look for the reversal. This wave down has a "steeper" angle of descent than the (A) wave, down in the (A), (B), (C) count.

      TJ

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  4. This comment has been removed by the author.

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    1. I was looking at exactly that earlier. ES just hit 2924 and bounced. That pretty much has to be the low for it to work. The gaps would both be in 3rd waves. The likely alternative seems to be a full crash just 8 or 9 trading days from a record high - which seems unlikely.

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    2. I think it can also be counted as 1-2 i-ii for the very first set of waves. And then your [2] becomes a [4].

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  5. If it is an ED, the target should be below 1800 very fast as EDs are fully retraced. Correct?

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    1. Generally, yes, but it can take as much time as the diagonal took to form.

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  6. 🤔. I see the B wave went away. All that fighting for nothing 😘

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    Replies
    1. My prediction fighting for ED and switching back to B:)

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  7. On the eventual bounce at some point I would anticipate heavy selling into the counter trend rally and new highs are probably not likely. Any opinions on whether the S&P 500 futures gap on 2/24 will be filled and maybe when?

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  8. I'm going to be deleting a lot of comments which are not pertinent to the situation at hand. Comments about speculative ranges, someone (anyone in the comments) who did find this, or didn't find that, what will happen on bounces, etc. Comments should pretty much be about counting the waves at hand, and looking for the rules-based Elliott wave patterns.

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  9. I propose there are 5 down in ES from 3180 completing ABC from the top with C a bit bigger than A - the first wave of a diagonal, and here comes a sharp relief rally into first week of March.

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    Replies
    1. A = C if you measure the first move down to 3091

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    2. ..possibly, but not yet. Cash isn't even open yet. And price is missing the next channel lower, yet.

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    3. It could be 4 down here with a 4/5 in cash market.

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  10. A re-test or lower low during cash session would paint the cash charts the same.

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  11. Two channels lower

    https://invst.ly/pzvc9

    TJ

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  12. Trying to count from failure.

    https://imgur.com/ZRnYPIq

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    Replies
    1. point of recognition on deck?

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    2. Last flat was again smaller in time then preceding one.

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    3. 2855 is the ((e)) wave of the triangle, or 4 of the diagonal. IT was just exceeded lower.

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    4. I am counting that flat as wave (ii) of 3 and I am expecting now way (iii) of 3 to break new lows

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  13. This could also be the x wave in a flat x zz to get back to 1 hour 34 sma.

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  14. Chart showing triangle low wave ((e)) of X, or 4 of diagonal was undercut.

    https://www.tradingview.com/x/77Ae79Gz/

    TJ

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  15. RUT is only .023 shy of fully retracing to its Aug '19 low.

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  16. Gold getting spanked. B on the Monthly?
    https://imgur.com/mo4ePCa

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    Replies
    1. sure seems like it, no wonder commercials were around 80 percent short on gold and silver

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  17. ES Flat X ZZ correction would be sufficient here, not saying done.

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  18. This comment has been removed by the author.

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    1. MTU.. first warning. Your count does not conform to degree labeling requirements. Post any more junk and it will be deleted.

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  19. My attempt from failure yesterday.
    https://imgur.com/q1sg98r

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    Replies
    1. Dont like the lack of alternation, but its a weak market.

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  20. Here is the next wave down, as best and I can tell. And there is excellent alternation in this count.

    https://invst.ly/pzznw

    TJ

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  21. For the advancement of our craft:

    Could this action today be the rare expanding triangle. I would think the EWO would look like this.

    https://imgur.com/NtcFb3u

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  22. 2835 ES would be 5 = 1 on the your above count and 1.27 extension on the larger count.

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  23. From what I think is an expanding leading diagonal off the top and then a correction, Gold has a 2.618 extension down.

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    Replies
    1. Does GOLD have as much 'time' upward as it does downward?

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  24. This is my current view on ES :

    https://www.tradingview.com/x/68eSsWFt/ (30 mins chart + EW oscillator)

    Wave ((iv)) has positive value in the EW oscillator
    Wave ((ii)) and wave ((iv)) alternate with flat and zig-zag
    The 3rd wave inside each impulsive wave has a minimum in the EW oscillator.
    Wave ((v)) of wave 1 makes an exception: it is bigger in magnitude than wave ((iii)) and I don't know if it can be accepted in some circumstances in EW theory (as an extended 5th wave for example ?)

    Wave 2 is a flat with w,x,y, as a 3,3,3 waves sequence.

    Current wave ((ii)) of 3 could be an expanded flat with a,b,c,d,e. See details in the 5 mins chart here:

    https://www.tradingview.com/x/7ZXMpI7a/

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    1. Matteo, in your second link; waves two's can NEVER be a triangle in their entirety. You are breaking the 'rules' of Elliott wave. You need to read up more on the basics. Please do not post more charts, until you have re-read the book. I don't want the blog readers to get confused. Please see my count at 12:50 pm, above, for assistance. The expanded triangle 'may' not be done yet. Kudo's for recognizing it as a triangle, however.

      TJ

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    2. Thank you ET, I was missing that rule indeed, I hope my fault could help others as well

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    3. @Matteo - I like your attitude ;)

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  25. ..just make sure the expanding triangle doesn't have one more up minor up leg to it - which would add more 'time' and help break the upper channel trend line a bit.

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    Replies
    1. ..mmm,hmm - an expanding diagonal off of 2,878 @ 14:08.

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  26. ET, I like your idea that loss of divergence on the wave 5 of a contracting diagonal is a "no go".

    When I grab the weekly on the ES, this would imply that the contracting diagonal idea, with the bad look and the loss of divergence, is not a great probability.

    Im thinking because of the size of the waves since 10/2018 that we are in a larger degree change. maybe the start of a large triangle to alternate with 2000-2009 flat.

    Am I thinking correctly?

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    Replies
    1. It might be the difference between a wave 1, which is at the very start of a trend, and an extended wave 5, of an extended wave (5) of an extended wave V; as in "unprecedented over-bought in a fifth of a fifth of a fifth". Not sure - so I am keeping the (B) wave as the alternate.

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    2. ..now please answer my GOLD question above.

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    3. This comment has been removed by the author.

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    4. I am probably not answering this correctly. I was referring to the weekly.

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    5. When I use the monthly bars, were one short but its the end of the month. Seems real close.

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  27. Break of lower expanding diagonal trend line.

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    1. ..as far as I can tell, the low of that little expanding diagonal broke slightly. IF there is a new high, then that would mean that 2,960 to 2,877 would be an "x" wave within the e wave of the triangle. Again, this is only IF.

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    2. ..lol... there's the new high..just in time for cash

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  28. Extended 1 -> 4 doesn't show up on EWO
    https://invst.ly/p-0s-

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  29. Maybe this is a better count describing the price action in gold.

    https://imgur.com/6Q6SsEP

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    Replies
    1. The interaction on the 15 minute with these lines is encouraging.

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  30. This comment has been removed by the author.

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    1. https://imgur.com/a/nd01y7e

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    2. I don't see how this chart is relevant to wave counting, and is therefore subject to deletion.

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    3. Ok.... just showing volume bars chart with 142 bars in channel... 8 fold path?

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  31. Now, dont be mean.

    https://imgur.com/SvgdBUW

    For more upward price in ES, I would suggest that the Contracting Diagonal is still on the table and we are doing a flat in a very weak market.

    I believe ET reached out to EWI at one time and they said that b waves really go down in probability after 1.618 but I do not know of much study on the matter.

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    Replies
    1. ..will consider that, if there should be upward overlap.

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    2. We often see b waves of triangles have a higher EWO than the previous wave, so I do not see a problem with the indicator. I believe it was the California Story that hit after that a wave.

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  32. https://i.imgur.com/8V4PlLH.png
    How about this view

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  33. https://www.tradingview.com/x/Rxk3zYdx/
    for short-term

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  34. Joe, in your top chart, if your count is correct, couldnt this be
    Intermediate Wave1 of Primary Wave 5? If it's the end of the entire advance EWI(not sure if that's your long term count as well, so no disrespect there) has mentioned what would invalidate this. Thanks Sam

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    1. Not likely. It is more likely the end of the long advance.

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  35. ET, both (b) of 2 and (b) of ((ii)) are long than 1. Is that allowed ? Can corrective waves have sub waves longer than same degree impulse ?

    Here is what i mean.
    Corrective sub waves longer than same degree impulse

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    Replies
    1. E_D_T, your degree comparisons continue to work 'backwards'. You are comparing waves in reverse order, not the order the market has made them. This will get you into trouble every time, and cause wave counts to have very little predictive value.

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  36. There is a new post started for the next day.

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