Although it is possible to count the Minor B wave as over and completed with the minute ((z)) wave at the high, responsible Elliott Wave analysts can look for realistic alternates and try to rule them in or out. This can happen on every chart time frame from 1 minute to 1 month. For the purposes of this exercise, let's look at a current alternate count - which is still in force on the ES 4-hr chart.
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| ES Futures - 4 Hr - Alternate |
Assume for the moment there is a bottom label of some degree on the lower left. Then, with three-wave cycles, it is possible to be forming a contracting diagonal upward, shown as (i), (ii), (iii). Because wave (iii) is shorter in price and time than wave (i).
Now, the good news is that this count would become relatively easy to "rule out" in that wave (iv) in a contracting diagonal - by rule - may not be longer than wave (ii).
Well, don't you know this morning that wave (iv) hit, but did not surpass, equality. Any trading below 3,199 in the futures would do it. It would invalidate the up count. We're not there yet. But, such a lower move would also likely break the up-channel lower boundary as well.
Wave analysts need to think about probabilities. They can not put the blinders on and assume their count is correct. They must look for evidence on both sides until the market makes a determination.
Have a good rest of the day.
TraderJoe
Perhaps Im missing something, but I have (ii) about 107pts, and (iv) about 85pts. Not sure what you're seeing as equality? Additionally, I have (iv) being > (ii) in time.
ReplyDeleteThanks
You are correct on both counts. New invalidation based on price is 3,177. Working quickly on the alternate, I grabbed the wrong high point with the Fibo ruler.
Deletehttps://www.tradingview.com/x/Dos3I6hT/
Thanks,
TJ
So the time factor is not disqualifying?
DeleteThanks
The waves are of the same degree. 'Ideally' in a contracting diagonal one likes to see the waves contract in time, as well. So, again, one can say the longer wave (iv) "slants the odds against the pattern", but not that it completely disqualifies it.
DeleteHere is the intraday wave-counting screen, updated with daily pivot points (classical calculation) and nearest fractals.
ReplyDeletehttps://invst.ly/rk1aq
TJ
I am not sure what the count would be but these daily gold candles look like it wants to go through the 2011 high.
ReplyDelete..c'mon .. try the daily count .. hint: this last wave up is 'longer in time' than the prior wave up. Post it!
DeleteI believe the fact that it is longer in time suggest that it is a c wave. possible c of 1 of a contracting diagonal.
DeleteES just traded below 3,199; ruling out the alternate - above.
ReplyDeleteThis is not correct. New invalidation based on price is 3,177.
DeleteThis is one way to count the futures as five-waves-down. Cash, too, has 'five-down'.
ReplyDeletehttps://invst.ly/rk1vo
Nothing yet says the down wave is over.
TJ
Could we be making a larger contracting diag, where we could be in "iv" now?
ReplyDeleteThanks
You would have to draw that option out and show the measurements. I'm not here to do your specific work for you.
DeleteSPY range from 6/8 High (323.41) to Low 6/15 Low (296.74) is 26.67.
ReplyDelete26.67 times 14.56% Fibonacci equals 3.88315
Add 3.88 to the 323.41 High equals 327.29 and 327.23 was the High on 7/23.
Subtract 3.88 from the 323.41 High equals 319.53 and 319.49 is the Low, so far, today.
Prices from Think or Swim (TD Ameritrade)
Here is an update with the latest fractals; the (e) wave of the running triangle is a valid fractal on this time scale.
ReplyDeletehttps://invst.ly/rk2vc
TJ
On the phone, but that looks like a contracting diagonal.
Delete..now in the middle of 'no-man's land'. All I can see are three waves up, and a diagonal down, so far. The (e) wave of the triangle was tied, not exceeded higher, yet. So, this could start a diagonal upward, or it could make a flat wave downward. Many possibilities. Very, very choppy.
Deletehttps://invst.ly/rk46q
TJ
..could also be an 'x' wave down, for a double-zigzag or triple zigzag, upward.
Delete..and there's a lower low for a possible flat
DeleteFWIW, the pause at 3200 a caution flag for me personally and argues for one more upside jaunt; a break of 3100 before the close says I'm probably wrong....
ReplyDelete.. um..a 100 pt wave counting stop?
DeleteI know it sounds crazy...but I predict the wave down after a top is in will take out both. But your point is well taken. I simply wanted to sound a note of caution against "all-in" sentiment at this juncture, nothing more... :)
DeleteIf correct we should get a C wave up past A then a new low with increasing droopage momentum into the close...
ReplyDeletepls remember to use 'reply' to add to your own comments in the same thread .. that way people can keep the thoughts together.
DeleteMove above 3219.12 cements possible C wave up...
ReplyDeleteFourth wave triangle instead?
DeleteIt's a difficult close to decide what to do so I will go home flat. If there was trading overnight I'd say it was bullish with the rsi bull divs and heavy wicks at the bottom but that can all be swept away by Sunday futures open. Have a good weekend all and thanks for your constant updates ET :)
ReplyDeletewelcome Roberto .. and you have a good one too!
DeleteHi Joe
ReplyDeleteI covered my short, thinking your alternate count is what Im in favor of, +D on the 60ty, IMO as long as the news over the weekend is neutral. IMO the 2nd stimulus gets passed this week, market hovers till its announced, market moves up on the event and then the selloff begins in earnest. Thanks for the posts, have a great weekend, Roger