Below is the 2-hr chart of the ES futures. We have been counting the first segment down as a-b-c, and the second segment up also as a-b-c, where c = 2.618 x a.
We have said if there is more downward movement to come, it will likely come as a diagonal. The chart above shows that the 'current' length of the latest down wave - after (ii) - is shorter than wave (i). For a contracting diagonal, such a wave must remain shorter than wave (i) and stay above 3,664.75 using these quotes. Conversely, if the down wave is to become an expanding diagonal, then that level must be exceeded as wave (iii) must become longer than wave (i). Simple. One simple number divides the counts.
Now, here is a shorter term 15-minute chart.
With the upwards overlap at the end of the day on Friday it is possible to have a fourth wave of an expanding diagonal for the next c wave. This would have the alternation pattern of an impulse and a diagonal if it occurs.
Similarly, wave ((2)) on the up side may not be exceeded for a downward count to play out at this point. If that occurs, it is possible the b wave may become longer in time. So far, all of the sequences count correctively.
Have an excellent rest of the weekend.
TraderJoe
Thanks for the counts TJ. Concerning the VIX, I think there is a high probability that it will stay below 55 for this wave down. If it exceeds that level then we are in crash mode again. But those high VIX levels are gifts that need to be bought IMHO. ATB.
ReplyDeleteyw.
DeleteIn regards to VIX, in January 2020 VIX was making lows of 11.5 area than the breakout. After the March pull back VIX is making higher lows in the 20's(19.5 lowest I see). Now we have a break out again, time will tell if VIX remains elevated.
DeleteThis happened after ‘08 too. Kind of like after shocks of an earthquake. It will take a long time to get back to 10.
DeleteThanks! Very helpful. It appears that if the exp diag on 15min plays out, then this will exceed the 1.00 measure on 2hr, suggesting it would be expanding (if ultimately a diagonal).
ReplyDeletethinking so.
DeleteAlong with GameStop, AMC is another in the "saga". Here's a look at AMC wkly (and thoughts on reg. hidden div.) if interested -
ReplyDeletehttps://funkyimg.com/i/3asAU.png
Honestly that looks like an abc move before 0
DeleteA last post on reg. hidden div (if interested). Two excerpts from Hayden's book -
ReplyDeleteRSI - The Complete Guide. Click on pic to enlarge.
https://funkyimg.com/i/3asUT.png
Disregard the click on pic. :o)
Delete👍 thanks GW.
DeleteFascinating price action. If the bounce in ES holds thtough the cash session, the former would have a low almost 40 points lower. In the few instances I have seen this happen, that discrepancy is usually ultimately corrected. The most glaring exception being of course election night 2016...
ReplyDeleteTJ - for alternative. What if your w1 & w2 are A & B and we are now in C wave down and it’s expanding diagonal? If this wave 4 of C does not go higher I think it works. W5 lower needs to trade at least to 3584 area.
ReplyDeleteSorry, should be 3633 area, not 3584.
Delete..see below.
DeleteGood morning all. Well, we got both things: a gap down in the futures Sunday night and the 'first-of-the-month' money. Given both the lengths of the down waves and the time-signature of each of the waves, this is the only count I can find that is legal. An expanding diagonal is not. A contracting diagonal is as wave (iii) is shorter than (i), and (v) is shorter than (iii).
ReplyDeletehttps://invst.ly/tntal
This does not mean more up movement is not possible. But, this is the only count I see in the futures that does not break the 'rules', and it does not look this way in cash.
TJ
Current look at 2hr. -
ReplyDeletehttps://funkyimg.com/i/3au1R.png
I think there is another alternative. This move down from high was an A wave and we are now in B wave with C down to come. We shall see.
ReplyDeleteES 5-min : after the infusion of the 'first-of-the-month' money, we may be getting near the end of a wave. Depends if that's a 'b' wave or a true diagonal at the high.
ReplyDeletehttps://invst.ly/tnvnv
TJ
..marginal higher high. Five-min is not a good time frame for TEFPM on this wave, hence EMA-13, not EMA-34.
Deletehttps://invst.ly/tnw07
TJ
Also 3782 50% retace..lotta stuff here..but then theres the CBs with a big smile.
DeleteTrade gap 3780ish close 3785 corresponds with your 2..short looking very tempting right here..time to get back on the horse? :) Short stop 3785 and holds for few minutes. Gl all
ReplyDeleteCash 5min reversal pattern. Watching for follow through.
ReplyDeleteES 5-min; here's where things are at the moment.
ReplyDeletehttps://invst.ly/tnwot
TJ
..key wave marker at 3,761.50 exceeded lower at the close.
Delete..notice how the pattern off the top 'looks like' an expanding diagonal.
Deletehttps://invst.ly/tnx2f
..some people don't think they exist; the timing of a potential turn is hard to explain else-wise, and it may not be done, yet.
TJ
Like the close...wondering how the open will go with my morn coffee...:) Thanks Joe and all, have great night
ReplyDelete..yw Roger.
DeleteA new post is started for the next day.
ReplyDelete