Messy Monday

The prior post cited a 'possible' truncation, and asked the question as to whether that truncation is real or not. As of 16:30 EDT, that truncation high has not been exceeded higher (yet). It could be. I can find three ways to end this (c) wave upward. One is an expanding diagonal that is posted in yesterday's comments. Another is this potential triangle sketched out below. A third is a truncation.

ES Futures - 30 Minutes - Fractals

The potential triangle might be a barrier triangle, or it might be a slightly contracting triangle, or it might be a failure triangle in which the high won't be exceeded. Or again, it might not be a triangle at all, and every thing since the overnight low might be an expanding diagonal, upward, for a fifth wave.

In my experience, the easier thing to do is to follow the fractal-breaks at this point. If it's a barrier triangle and the fractals break up, it might be a short pop to 4440. If it's a contracting triangle, then the thrust might be larger to 4,450-60. On the other hand, if the fractals break down, it might be a failure triangle ending the move, and one should not be surprised.

Again, patience! Calm .. and flexibility, too. Try to remember that the reason the big moves often come in the overnight is that - with the lighter volume - the market makers don't have to have so many people on board.

Have a good start to the evening.

TraderJoe