On the hourly chart below, last night we counted out the five-waves-up to ES 4,361 which was followed by only three waves down. As you see below.
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| ES Futures - 1 Hr - Impulse Plus Flat |
During the day, we noted the level at which one should look for a Flat wave, not a downward move. That level was exceeded higher. The down wave was extremely short in both price & time. It measured to only 14.2%. It is possible that is all there is to a correction? Yes, possible but it would also be extremely rare.
We think we have the impulse labeled correctly because it's wave iv is located at the 38.2% retrace marker. A better possibility might be that the wave makes an expanded flat wave to provide more form and balance. A return to the 38.2% Fibonacci level can not be ruled out.
However, with the higher high after the impulse (b-3 wave or not) the upward diagonal count gains significantly in probability. This probably would also help the Dow to get over it's all time high which we said was entirely possible.
Two higher highs have been made on hourly MACD divergence. The daily price bias is currently higher because price is up over the 18-day SMA. And the daily slow stochastic is up in over-bought territory and is not yet embedded.
Comments remain on moderation. People were trying to issue "buy" signals today because of the VIX - not down at 4,227 where we pointed out the 62% retracement level. This is just one of the many reasons why buy and sell signals are not permitted on this blog. When some people figure out how to behave here, then the comments might return to free-form. Once again a few people can spoil it for the rest. No skin off my back. I have other things to do.
Have a good start to your evening.
TraderJoe
An aside -OEX/SPX (mthly) - has the long term trend changed?
ReplyDeletehttps://www.mediafire.com/view/2cug49tqoo6h4o6/OexSpx.PNG/file
Question - Wouldn't Neely have an issue with the 2-4 TL being broken by any part of 5th? I was thinking he would suggest that 4th had not yet completed if this occurs.
ReplyDeleteThanks
hmmm..understand the issue; let me go back and check.
DeleteYes, the suggestion regarding wave 5 remaining entirely above the wave 2-4 trend line appears on page 5-11. So, one could draw that trend line thusly in the first impulse, up.
Deletehttps://invst.ly/viodj
That makes all of the prior overnight, and subsequent small 14% drop the correction.
Still it would not have helped separate 'a' at the first impulse location from a ((1)) at that location. Or whether the correction was 'b' down or ((2)) down. It is a 'very' small correction.
TJ
Meanwhile, in the overnight prices look to have overshot a classic "b" wave of a flat.
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So far, there is not much more than an hourly wedge, ("the wedge of the wedge keeps wedging until the wedge won't wedge"). On the upside, there is more room to push out the upper wedge line as the tops are not a precise fit. And on the down side hard to suggest anything until the lower wedge line is impulsively broken, and then successfully back-tested.
The whole structure could be wave 'a' of (iii) of the larger diagonal count.
TJ
With downward overlap, and a break of the ((2))-((4)) trend line I now get 'five-waves-up' on the hourly, with a first wave extension.
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TJ
Now over the local high, and all-time-high. Can still be five-up.
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Difficult stuff.
TJ
..now bumping up on upper hourly wedge line; can go a bit higher in a 'throw-over' if it wants.
DeleteTJ
An observation, not a prediction - a reversal by day's end [could] set up a 2B top.
ReplyDeleteMuch better look with wedge over-throw...!
ReplyDeleteNQ (dly/4hr) - what Im watching [if interested] -
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ES 4,400 was just hit. For wedge to break need to see full hourly reversal candle, now or in the future.
ReplyDeleteTJ
Just fyi - No hourly reversal as of 11 AM candle.
DeleteJust fyi - Upper daily Bollinger Band at ~4,404.50, or so.
TJ
TQQQ short term divergence on the 2 minute chart. If we get a reversal here there is no guarantee as to what size it will be but it should play out very soon from now.
ReplyDeletehttps://www.tradingview.com/x/xaHqHHKZ/
Just fyi - Now up to upper daily Bollinger Band, or again (as Ira says, and I pointed out at the low), "this is the place where the Smart Money takes some off the table; and where no 'new' longs should be taken."
ReplyDeleteAlso, the 1 PM candle has a higher high. For anything believable, there needs to be enough down power to make an outside hourly candle down. Nothing yet.
TJ
..the above is not trading or investment advice - just paraphrasing a broker and what he teaches.
DeleteTJ
if anyone finds fib time sequences interesting.. also y = 1.618 of w in time using TJ count
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There is a new post started for the next day.
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