Today's intraday ES futures made some lower lows, but pretty much spent the day creating whip & foam. As a result, three-wave patterns abound. In the window on the left was a potential diagonal working downward on the ES 15-min chart, using three-wave sequences.
On the right is larger time frame ES Hourly chart. This chart could use some of the same three-wave sequences to make a triangle. As I have mentioned before, this is one of the reasons that I refer to diagonals and triangles as "cousin patterns" - because some of the very same three-wave sequences can go to making up both. And it is one of the reasons you will rarely see (not 'never' see) a diagonal leading into a triangle or directly out of a triangle: they are 'too similar' in structure and it would represent poor alternation in a corrective wave.
The potential downward diagonal on the left has not formally invalidated, but it has lost much of the 'right look' and didn't make much downward progress today.
The hourly triangle looks a bit short and stubby at this point, and might take more hours, say going into the FED meeting. IF it should prove to be a valid hourly triangle, then it does suggest somewhat higher prices than 4,200 (say 4,210 to 4,220).
Anyway, they didn't let us know by the settle. Let's see what FED day brings tomorrow.
Have a good start to your evening.
TraderJoe
Thoughts on 4hr cash -
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Money flow may be hinting at developing inter-market bearish divergence. A tremendous amount of capital was expended in YM trying to re-capture 33,850 as a support shelf. So far, no cigar. A level worth watching...
ReplyDeleteGood morning all. From the diagram on the right window, above, the ES 60 minute can now be seen to have made a valid triangle with better proportions. Now, it is up to an ((E)) wave not to invalidate.
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TJ
Thanks TJ
ReplyDeleteI am not able to comprehend triangle non invalidation and higher prices till 4220(apprx).
What is the parameter for higher prices?
Over wave ((B)).
DeleteThought I was incorrect on tag of 4200 but if triangle plays out i's a foregone conclusion. Was wondering why stops not triggeted. I have never seen such an endless parade of triangles!!
ReplyDeleteI like to look at this chart occasionally with BB and PPO set on 50 period.at some point we will trade back to 50 dma.
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ES 60-min, now up over the current ((D)) wave location.
ReplyDeleteTJ
..chart below ..
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TJ
..triangles can expand one time (within limits), like for example, to catch up with the cash count. So, we must allow an alt: ((d)) if the market wants - which might result in a lower ((E)), too.
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It is why they say, "trading in triangles is treacherous".
TJ
Is this still iv of the (iii) ? It's much much longer in time than ii.
DeleteNo. Go back to yesterday's post. We are in the (b) up. So. This is c of (b). This is micro-((4)) of that c. It is paired with micro-((2)) of c.
DeleteTJ
DJI vs DJT (daily) - (prior to Fed)
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ES 60-min; looks like a larger ((E)) wave is underway. Watch out for invalidation.
ReplyDeleteGap down past DJIA 3400 might be signaling 5th wave truncations ahead in other indices if gap stays open.
ReplyDeleteES got the lower ((E)) wave. Reminder of the FED at the top of the hour.
ReplyDeleteDid anyone notice the similar price action off the March 2009 lows to the April 2010 highs Sven H has pointed out to the current move off last year's low, slight April new high included? to the day!!!
ReplyDeleteNo, no similarity, put an EWO or RSI flag and you'll see the momentum is spread out very differently.
DeleteI did. Both marginal new highs came with bearish RSI divergence.
DeleteAlso interesting how triple Q and DIA have traversed virtually the identical distance and posted the same numerical value for the ETFs at the new ATHs...fracals abound....
ReplyDeleteES now up over the new ((D)) wave.
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TJ
..ES now up over the ((B)) wave, validating the triangle. Can remove the lower "invalidation" now.
Delete..chart update ..
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TJ
FED .. Money market 'runs' comment, and Treasury market dealers less committed. Some assets might appear high. These resulted in somewhat of a reaction in price.
DeleteUpside 4200 target FiNALLY achieved. I am out!
ReplyDeleteLooks to me like inte-market bearish divergence plying out with YM STILL under busted support shelf at 33850.00. Unless that changes I suspect things are gonna get ugly...
ReplyDeleteUgly it apprently is...
ReplyDeleteContent to observe from the sidelines. Markets as cagey as I've ever seen. Watching for the invisible hand, lol! Have a good evening all!
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