For an impulse wave to be in effect on the four-hour chart of the ES futures, below, there must be a non-overlapping fourth wave higher, and then a fifth wave to a lower low. Truncation not allowed. In the chart below, the invalidation level for a fourth wave is shown in orange.
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| ES Futures - 4 Hr - Channel |
At this point it - an impulse - is still plausible. The major wrinkle, so far, is that wave Minor 3 is not a 1.618 wave. It is a 1.382 wave at this time. But, this may be understood in terms of the massive Federal Reserve stimulus that was thrown at the market on Thursday & Friday, and what will likely be some fiscal stimulus in the form of legislation early next week.
We will note - as in previous posts - that the Elliott Wave Oscillator has made a lower low, and is now likely trying to regain the zero line or near to it (remember, it is allowed to stall around +10% of the lowest trough reading). And all of a third wave is below a line from 0 - 2.
The EMA-34 appears positioned properly to tag a fourth wave, but even it doesn't have to do so right here. Why? Well, a triangle or flat could form for a fourth wave, and the EMA-34 might wait to tag only the minute ((e)) wave of such a triangle or the minute ((c)) wave of a flat.
The reason I say there are no preconceived notions is that this count could devolve into a contracting diagonal or other structure made up of waves starting only of A,B,C as shown in the alternate count in red.
If the market wants to continue to impulse, it might do so after - or in conjunction with - the upcoming FED meeting and policy announcement. A triangle fourth might be awaiting a FED decision, etc. Remember, a triangle could be a running triangle or barrier triangle, as well as a regular symmetrical triangle at this point.
So, the best plan seems to be to follow the internal waves as closely as reasonable, and see if that lower low is made, or not prior to wave 4 invalidating.
Have a great start to the weekend.
TraderJoe
Hi, Joe,
ReplyDeleteThanks for excellent analysis. In the above chart, we can only visibly see 3 waves down from 2 to 3 and Friday's up move has overlapped first down move from 3129 to 2695.25. How would you count the internal structure from 2 to 3?
Thanks!
RC
Please look at the second chart in the previous post for the exact internal count on wave 3, made up of five minute waves. The first chart is the link. The second chart shows without a link.
DeleteHi Joe, and thank you. Do you see any clues in the wave 3 or C wave structure and EWO signature that would make you lean one way or the other? Also, if 4 overlaps 1, could another alternative count be A, a b c, B, and then C?
ReplyDeleteSecond question first. No, absolutely not because then your second b would be longer than the first higher degree A, and that is a degree violation.
DeleteFirst question. The trend is your friend.
Got it, thanks.
DeleteI just wrote a long dissertation that GOOG vaporised. My chart speaks to how I interpret this fall so far in the Dow futures YM's. If we don't start to fall out of bed Monday then my count is probably wrong. Thanks TJ
ReplyDeletehttps://i.postimg.cc/d00wChKz/2020-03-14-0928.png
Within (2) it is virtually impossible to count c as five waves. That is the first factor that makes the count completely incorrect. You would 'have' to label it as w-x-y. But, there is also the fact that c or y does absolutely nothing to extend a correction in price. So, I just view this as a lesson in 'cartoon drawing.' Any more that are submitted will be deleted.
DeleteYou know....I am right! Because I understand what Elliott is showing me. Few people have a system to show what the market is doing. Get out of the box and don't be married to one system. If then you might be better than the rest.
DeleteThis market will start a powerful 3rd wave down and will waterfall. How do I know this? Because that's what this chart of UNH tells...Probably many stocks made the same pattern in 1929....get ready.
https://i.postimg.cc/sX0r5jZ3/2020-03-14-2043.png
Quite possibly a CYCLE degree bear market / recession is underway, an approx 50% decline, charts here...
ReplyDeletehttps://12345abcdewxy.wordpress.com/
..haven't even made a clear five-waves down, yet. Let's see if it does.
DeleteHere's a look off the bottom. Perhaps the timing of leading diagonal is skewed due to the circuit breakers. Still, there is a clear 62% retrace from the high.
ReplyDeletehttps://invst.ly/q4adv
TJ
this is the count I was trading with - thanks for posting it. Circuit breaker was a nice "4" :)
DeleteIf this is ABC from top, it will be quite alot bigger than (A).
ReplyDeleteWouldn’t be a degree violation? Or is the extended wave of C allowed to be bigger than (A)?
..this is a 'new' downward wave, after a completed upward wave. I think you are trying to compare degrees 'backwards in time' again.
DeleteBut (A) and (C) is building the same correction together, they are of the same intermediate degree. I understand that (B) was ”a new” upward wave, but (C) is down just as (A).
DeleteIf I’m not mistaken, in previous zigzags you have compared (a) and (c), why not in this flat?
I'll say it again. This is a 'new' wave.
DeleteBut a few days ago I asked you about a degree violation btw a W and Y, then you said it prop was a degree violation. It’s always different answers, that’s why we always have to ask the same questions.
DeleteAnd what do you even mean with a ”new wave”?
"New" means (definition): the degree has turned. And we are trying to count the extensions in an impulse, as Ralph Nelson Elliott taught us.
DeleteWe will always count impulsively unless we can not. Hence, the A-B-C is an alternate (only) until it is not.
..as an example, see the fifteen minute chart link I posted above. I tried to count 'impulsively' off the low. That could not be done because of overlap. Others tried counting (i), a, b, c (ii) but that results in a degree violation because b is longer in time - and possibly price - than (i). Those structures 'are in the same direction in the same wave'. They are not in different waves.
DeleteWhen I could not count impulsively, I counted as a diagonal. Diagonals are 'often' just 'a' waves. Then, there is a short b wave. Because the wave is so short in time, it is 'probably' the b wave in zigzag. And it is 'probably' not a second wave. The next wave 'is' counted impulsively upward, so far. It could have more to go.
But, that is some of how a wave count is developed, and degree violations found 'within' it. And, it 'could' be incorrect. The upward wave could explode more than anticipated - on some kind of stimulus news. But, for now, the wave is largely in a channel and 'looks like' a zigzag - even 'though' I 'tried' to start counting impulsively from the low. But the rules can not be broken.
Thanks for this example, it's a good one for reference
DeleteHi ET, I don't know if you'll sometime to have a look at the DAX...Concerning the downward movement. The count seems to count as a zigzag. The hypothetical wave 2 retraces less than 38.6 and wave 3 extends more than 1.618 x wave 1. According to Neely it can't be 1,2,3.....Your precious comment would be most welcome.
ReplyDeleteHi Saint .. never met a Saint before. In the big picture, nothing is different from 2009.
Deletehttps://invst.ly/q4bbb
TJ
Happy to be the first one though...Thanks for the response...Seems to be an expanded flat...The only thing is that according to Neely as mentioned earlier the C wave is not a five waves as per the rules for an expanded flat...It is most likely a zig zag....One more thing C should end at 100%, 123.6% and is invalidated at 161.8 of waves? Thanks ET
Delete..the reason I showed that count first is you have to note that "massive" B wave within the wave (4) triangle. I think because there are only 30 stocks, you are going to have problems with "B" waves. You 'must' acknowledge that this index is simply 'not' as widely traded as the Dow or S&P. You can verify this based on volume. This is a simple fact. It is why I don't follow it or use it to make predictions for the U.S. market. Other analysts say, "the DAX did this, therefore the S&P will do that". I do not. Each market and each index is unique and separate, and should be counted as such.
DeleteI know you are interested in the shorter term count. If it is 'not' an A-B-C zigzag, then, consider this long ((b)) wave as part of a flat wave 4.
https://invst.ly/q4bgf
Such a flat might fail, slightly.
TJ
Excellent ET....Thanks a lot for this count....Cheers
Deletehttps://www.tradingview.com/x/bspu0Jvy/
ReplyDeleteET,
Need your help on this difficult count. This is the best possible fit I see at this time. Our Fed has announced tons more stimulus. That C wave is supposed to be swift and fast en which we are looking at higher time frame charts. My best fit for the 5th leg (not shown) is finish in the 2130’s. I know I read Bill Williams to say “ if a red bar comes right after a higher high get out now” I can’t find it in his books. I know I read him say that but I just can’t find it. Darn it!
Sorry, Bill. If you have that count, I can't help you out. I will explain more in a post shortly.
Delete..see below at 6:47 pm.
DeleteI thought this was fascinating. Not count, just a long long term channel and the the recent decline seems to know that it is there.
ReplyDeletelong channel https://imgur.com/ANbc1va
recent decline https://imgur.com/YokASeH
Just an observation...
ReplyDeletehttps://drive.google.com/open?id=1ZVqi2I1f9crmfzwC7JJc_HEgY2p13YTV
@Bill, @BBRider, @ Oddvin - just put this one - likewise - in the category of 'interesting charts' or observations, or speculations, and not a count.
ReplyDeletehttps://www.tradingview.com/x/bRXJdk4n/
TJ
So in other words it's all subjective. Is the Blue line (jaw) going to hold. If I were to look forward toward the monthly chart I'd follow the rsi 14 above or below 40 on close. It's the middle of the month and possible middle of a intermediate 3rd wave down wait 4th wave up. It's a darn crap shoot at this point. I'll dig deeper into the NYSE index chart you posted as it is clearly below the Jaw. Rsi is clearly below 40. That would favour an S&P target under 1810 or the previous 4th wave.
ReplyDeletehttps://www.tradingview.com/x/DC5TaZ3J/
No. I think you are missing the point. First, five waves down need to be verified to occur. After that, the retrace speaks to where we go next. If you can't bust that high, we go lower. It's pretty darn 'objective', but it needs time to work out.
DeleteTriangle
ReplyDeletehttps://snipboard.io/w4osmH.jpg
No! In a triangle, wave e 'can not' by the rules go below wave c. You are continuing to post junk, and it will be deleted.
DeleteNo idea. I'm really not too interested in $Hui. Sorry.
ReplyDeleteHas any start to a major bear market ever began with a clean 5 waves down? Food for thought.
ReplyDeleteFor what it's worth, AAPL GOOGL and MSFT look like they made 3 waves down. No 1.62 extensions. Keep an eye on these to get good timing on short reentry.
TJ, shouldn't max(min) EW Oscillator be on 3rd of the 3rd? By which count we may not have finished 3rd wave yet?
ReplyDeleteSee the next day's post.
DeleteA new post is started for the next day.
ReplyDelete