It's Tuesday

The market as measured by the ES E-Mini S&P futures made an outside key reversal day down, as of the futures settlement. The NQ futures closed lower, too, settling just about dead on its 18-day SMA.

Earlier in the day, this chart was published of the cash Dow Jones Industrial Average. Please consider the (a) and (b) as minute degree waves .. I was working quickly on several markets.

DJIA Cash Index - 4 Hr - Pretty Clear

Regardless of what a few tech stocks are doing, this chart seems pretty clear and unambiguous. Price appears to have made a zigzag in a channel upward since late June. Thus, the options for wave labels also seem clear. The entire sequence from March 23 counts as W-X-Y, the double zigzag, OR it counts as the first three legs 1-2-3 of the upward diagonal wave, with wave 3 as the higher high. Just like a triangle, you can't call a diagonal until all five legs are "in".

One of the reasons I am focused on the Dow at the moment is that the ES and the NQ have already made their 90% retrace levels. The Dow has not. Neither has the Russell. Will these be the only two indexes not to confirm a compound flat in progress for the Primary ((B)) wave, higher, written about earlier? That would seem odd.

Yesterday, I suggested in the ES futures, there might be a way to move the label 3 to what is now today's high. That still seems be possible. One reason for thinking such is that the advances and declines were only just-about-even today, and the advance-decline line made fresh new all-time highs this week. That data doesn't immediately suggest the start of a crash.

Bottom line: Today was a key reversal day. We've been here before; we need to confirm any retracement wave holds lower than the high. Further, while it's 'possible' an Intermediate (A) ended with today's wave, it also could also just be the end of a Minor 3 wave, with 4 & 5 to follow. Clearly, any price movement in the Dow below 24,800 before making a 4th and 5th wave higher would invalidate that scenario. And, for the diagonal, wave 4 must overlap wave 1. That has not occurred yet.

(Please note at some point in the future, I may consider upgrading the Minor labels to Intermediate. It depends a lot on the post-pattern behavior from the double zigzag or the first three legs of the diagonal.)

Have a good start to the evening.

TraderJoe