First of the Month Money

Today was the usual influx of cash from the reinvestment of dividends, contributions from company 401k accounts, company bonuses, and pensions which are often automatically allocated to the market-place without much human intervention on the first trading day of the new month. As the result, the wave which I showed yesterday as the invalidation point was hit today at the end of the day. This is shown in the chart below.

As a result, I demoted the waves in the count to minute waves, and we now have a Minor wave 1, at the low. I did stick to my word about the invalidation point, and the count below does meet degree labeling requirements.

ES Futures - Hourly - Minor 1

I told blog reader and contributor BBRider I would consider the downward diagonal, which he must be given credit for proposing, if an when there was upward overlap. There was, today, at the very end of the session. There wasn't much point to looking for a better count until there was that overlap.

One problem is that the count from the bottom is a complete mess, and therefore may still be an incomplete structure - and it 'may' be the start of an expanding diagonal. 

However, given the rise in the EWO to the level it has risen to (beyond -40% of the trough low), it appears that a second wave is in progress. By comparison, wave 2 will have a lot of hours to burn yet - many of which will occur in the overnight.

This is all I can add at this time. It was a funky wave down - not withstanding the 77 point drop in the futures last night - but there is alternation as shown and minute ((v)) on a 5-minute chart is an expanding ending diagonal that counts very well.

Have a good start to the evening.

TraderJoe