Watch for Possible 'Length Violation'

We have been counting primary equity market indexes (such as the S&P500 and the Dow) as Intermediate (W), (X), and (Y) of a Primary ((B)) wave, upward. We still are. Yet, on 18 May we posted an "Interim Report" saying that one index that 'could be' counted as a contracting diagonal - according to the rules - was the NQ 100 futures. An updated chart for that count is below.

NQ Futures - 2 Day - Nearing Length Violation

It is now time to watch this chart very closely, because, if the level of 14,772 is broken higher, then the wave (5) location would become longer in price than the wave (3) location. And, that would be a violation of the rules for contracting diagonals. Wave (5) must - in a contracting diagonal - remain shorter than wave (3). So, IFF that violation happens, we think that the NQ 100 would better confirm the count on the other indexes. So, let's say that happens. Let's say the NQ futures exceed 14,772. Then, we think the next count - as shown in the chart below - is the one that reverts to the same as the S&P and the Dow.

NQ Futures - 2 Day - IFF length violation occurs

 

To avoid a degree violation in time, it is possible that the second Minor B wave in March 2021 ended where shown. That makes B shorter in price and time that wave (X) - the larger preceding down wave. But, I can not rule out entirely that there may be a triangle B wave (shown in red) in the pattern. That triangle ends the first week of June 2021. So, let's see if 14,772 is exceeded next week or not.

This is the second post this weekend, and if you have not read the first one yet, you may wish to read it now.

Have an excellent rest of the weekend and holiday.

TraderJoe