What we did today:
- We realized the daily slow stochastic was still embedded, and price still has an upside bias over the 18-day SMA. We also realized from yesterday that price closed over the daily Bollinger Band, and there is only about a 5% chance of that occurring.
- We placed a dashed gray line on the chart to show where the upper daily Bollinger Band was located, and the day's pivot points (classic floor-trader calculation).
- Then, we looked over the overnight count in the chart below an realized the count made absolutely no sense unless there was a triangle in the middle of the sequence. That triangle is highlighted in blue, below.
- Next we realized that yesterday's "blast off" wave, where there is little retrace, is 'usually' an (a) wave up. This is shown as :5 in the chart below. That's why we said yesterday, the count may not be done.
- So, given the overnight count of only three clear waves down, including the triangle, we suggested we were making a b-3 wave up, and then should make a flat wave.
 |
| ES Futures - 30 Min - Flat Wave |
We cautioned all, we did not know if the initial high was the end of the b-3 wave at the Bollinger Band. It wasn't. But, then, we got a doji candle on the R1 (Resistance Level 1 - Floor Trader's pivot). We said that there needed to be a substantial confirming lower close candle, and there was. This was followed by a stronger bearish outside reversal candle, and then the low of the a-3 was exceeded lower, proving out the FLAT wave. A real key to this count was identifying that internal triangle. I know people hate diagonals and triangles. Learn to find them, and they can actually help your confidence at labeling waves.
This kind of whippy action represents a market that is getting tired. We further pointed out - and showed by chart - how the up volume in the b-3 up wave was much, much lower than than in yesterday's five-wave sequence upward.
So, now we have a "b" wave count that exceeds the high, on a smaller time scale than the daily chart. The purpose was to give the prior up wave more time and proportion. Is that what is happening on the daily chart, too? It certainly is a likely candidate.
So, now we have a "b" wave count that exceeds the high, on a smaller time scale than the daily chart. The purpose was to give the prior up wave more time and proportion. Is that what is happening on the daily chart, too? It certainly is a likely candidate.
The market closed with the daily slow stochastic still embedded, and bias being upward. But, overall, the day formed a doji and closed just inside the upper daily Bollinger Band.
Still the higher b-3 wave indicates there could be another push upward. But, there does not have to be - or if there is - it might fail.
My market outlook is reverting again to 'negative', and, yes, I might be a few days early. (This is a wave-counting outlook only, and is not to be taken as trading or investment advice.)
Have an excellent start to the evening.
TraderJoe
excellent work ET - thanks for sharing
ReplyDeletejoske
..welcome joske
Deletefyi - Do not trust Investing.com website quotes at this time. They are showing ES at 3,037 at this moment. Broker quotes are at 3,025. Something is going on, like the page not updating or something.
ReplyDeleteThank you for your time and kind.
ReplyDeleteThis post is perfectly written and clear step by step explanations, you are awesome!
ReplyDeleteYes it does look better with the triangle.
I will ask again: what does this mean: daily slow stochastic still embedded?
Thanks again!
Please read the whole of this post, but particularly the second paragraph under The Slow Stochastic Indicator.
Deletehttp://studyofcycles.blogspot.com/2015/11/paraphrase-of-ira-epsteins-rules-for.html
TJ
What kind of flat? Because according Neely it is not expanded flat anymore.
ReplyDeleteThe reason I went negative yesterday is there is a roughly-equal chance that instead of a (b) wave up, that small wave up was 'c' of (z) of ((b)) and that is what happens in corrections. They are exceptionally difficult to gauge.
DeleteHello Joe.
ReplyDeleteI have a wedge on my charts, targets that big gap in the low 2500s.
Full moon low a possibility, especially as the top has stretched past the new moon.
https://www.tradingview.com/x/KUvAl3V0/
So many calling a top
ReplyDeleteMy "Pet Theory" says "Nyet".
What are the statistical parameters and the specific time period of your "pet theory"? What is the back tested success rate of this theory?
DeleteNot the forum for a lot of detail, but in a nutshell, I theorised that move past S/R levels being accomplished with leverage, whether by CBs or HFTAs. I started to wonder about this due to the relentless rise over so many years on declining volume. Movement back below S/R that are violent MAY indicate leverage unwind. It is part of a mix of indicators I personally use to inform market decisions, nothing more...thanks for asking!
ReplyDelete..please use the "Reply" link when responding to a question so the threads stay together.
DeleteES 2-hr is now breaking both the primary (solid) and auxiliary (dashed) trend lines. There is a way to see the minute ((b)) wave as completed, and that is if yesterday's higher high was a short 'c' wave of (z) of ((b)).
ReplyDeletehttps://invst.ly/qz37z
TJ
Watching 3K. The level you cited as relevant now breached. I am going to go out on a limb and predict that if we stay above 3K we head higher...
Deletecurrently bouncing from trendline that connects the 2 x-waves
Deleteanother pop for c of z remains possible i think
joske
Probably not the best question to ask, but if we assign a 3rd wave ending at the "b" after (y), could we see the move up as an ending diag.? The 4th looks a little iffy, but does measure.
DeleteThanks
Here is a chart with what we have to this point. Pivot S2 is at 2,295. Remember a second wave, (ii), of a i, ii, (i), (ii) should remain beneath the declining trend line shown.
ReplyDeletehttps://invst.ly/qz3o2
TJ
Can you show a longer term picture - are we in the larger minute c now?
DeleteThere must be a confirmed i, ii, (i), (ii), and lower (iii) before saying we are in the larger minute c, down. It is 'likely' we are in the larger minute c down. It is not 'confirmed'. Do you get the difference? The larger 2-hr chart has been posted above in my post of 10:51 am.
Deleteunderstood thanks boss
DeleteSo far, that's a great TL, tested once, and again now, still holding by the looks of it, although I have a delayed ES feed, amateur-level me!
DeleteTypically, as I wrote, and pressed 'publish', it broke!
DeleteOr did it. I will just watch and shut up!
DeleteLOL. Here we go!
DeleteJust ignore me, what a schizo market.
DeleteCould you please take another look at Gold? We are over the resistance of the 1723 area on spot, just wondering what your thoughts are on the count? thank you very much
ReplyDeleteIn GOLD...only three waves down, so far. That means any downward progress is by diagonal, only, and upward progress could occur as a larger triangle. It's no man's land until or unless an upward Fib holds.
Deletehttps://invst.ly/qz4fq
I know people want 'definitive' answers, but sometimes I can't make more out of it than it is. A lower low before a higher high means downward progress.
TJ
great - thank you!
DeleteLooks to me like a bear flag. If so 3K is toast...!
ReplyDeleteBoo-Yah!!
ReplyDeleteStill think 3K not significant? Lol!
ReplyDelete2pm press conference FWIW
ReplyDeleteShowing that 3,000 had no significance, but S2 did. Up wave is now too large for a sub-wave (ii), bout with upward overlap, it could be a new location for ii, particularly if the upward wave fails.
ReplyDeletehttps://invst.ly/qz5l2
tJ
..down movement currently counts best as a,b,c - perhaps as the first wave of a diagonal. This remains to be proven.
Deletehere is an updated chart. It is all I see, so far. A second wave up can push the upper trend line around a bit if it wants.
Deletehttps://invst.ly/qz5qf
TJ
fyi - on the 2 hr chart, if we label the two 'x' waves as (x)1 and (x)2, the newest down wave is longer than both of them.
Deletehttps://invst.ly/qz5-s
That means a "Turn in Degree" is highly likely. There is only one way for the market to correct a problem with degrees, and that is with a triangle. However, if we have just counted a-b-c, down, then a triangle would invalidate below today's low.
So, that means any lower low than this afternoon's low should point downward for quite a while.
Hope this helps,
TJ
Could this be the 2nd (x), with (y) where short (z) was?
DeleteThanks
Excellent insight as usual....As the required 132% required for a B flat has been exceeded, can we now consider a zigzag instead of B, it would be X? Thanks indeed....
ReplyDeleteHi. No, not quite. See the next day's post, and thanks for asking.
Delete