Some equity markets started off a lot higher on the continued prospect of the passage in the U.S. House of Representatives for the next phase of the stimulus bill. The ES for example was initially up +17 points in the overnight markets, then reversed fully to be down -18 points. The NQ was up all day. Here is a brief survey of markets.
The ES/S&P closed the day lower, the NQ higher, the Dow and Russell futures also closed lower. Both Gold and Crude Oil also had lower low days. The VIX was up slightly and interest rates fell off a bit.
The possibility of an ending contracting diagonal remain in the ES futures. We diagrammed that in the comments for the prior post along with the hourly count. The ES today made the first higher high which might be wave (i), most likely of a diagonal - IFF it forms properly with 62% retraces. If it doesn't we may only be making another 'b' wave. We're not sure yet of anything except all the overlaps.
Have an excellent start to your evening and to your weekend.
TraderJoe
GNLN - Ending diagonal in progress? Comments welcome. Thanks!
ReplyDeletehttps://www.mediafire.com/view/8j27tx9fjrtkyvz/Thoughts.PNG/file
GW.
DeleteIt would be interesting to watch how these overlapping waves playout. The reason is that your (ii) is not at least 62% so that would suggest an (x) or (b) wave as opposed to an ending diagonal according to TJ'S post earlier "Equivalent or Not"
Hopefully my understanding of that post is correct and applies here.
That's an interesting point. Two thoughts on (x) or (b) -
Delete1. If (x) (of assumed wxyxz, 5 waves), it fails to overlap 'a' of (w) - problem
2. If (b) - [IF] (a) down is 3 waves, then it would seem that (b) would need to be within a flat (90% retrace or more).
Could be wrong (there's always that!) lol
Thanks for the observation!
@Tjchuck .. yes your understanding is correct. Odds of an E-D without a 62% retrace drop quickly.
DeleteTJ
SPX (wkly) - models update -
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👍 pullbacks are to be bought. Don’t like the divergences right now. I imagine by the time we get to (v), the fed will have inverted the 3mo/10y and it will be time to buy IEF.
DeleteStocks above 200ma - courtesy of IndexIndicators via free wkly email from TopDownCharts
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https://www.tradingview.com/chart/uDMVTKLj/?symbol=SPX
DeleteStocks above 20 dropping too.
@TimH .. link won't open for me.
DeleteTJ
Not sure why. Only 45% of SPX stocks above 20 dma
DeleteXLE/SPY (wkly) Two things of interest -
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Two key levels to watch for downward overlap in daily GOLD: 1,835 & 1,815.
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DeleteLet me see if a light just came on (regarding the 62% w2 retrace in a diagonal)
ReplyDelete"when over the prior wave 3 or A high" - so in other words, to qualify as a true "ending" diagonal. (So I assume a leading diagonal ('A' or '1') does not have this requirement, thus the GOLD diagonal doesnt have this requirement).
So, if a move above high of A has a contracting 5 wave pattern where its 2nd wave doesnt meet the 62% requirement, its likely within a flat or triangle pattern. Same with a move above a prior wave 3.
Is this what the "when over the prior wave 3 or A high" means?
Thanks!
And to add to the above, the Gold diagonal is expanding, not contracting. Duh
ReplyDeleteIt's been a bad weekend (and they said this Prevagen works, lol).
And the Gold diagonal is proposed as a leading diagonal, not ending.
DeleteTJ
Yep, I acknowledged that above
DeleteDXY - dly - head bump ahead?
Deletehttps://www.mediafire.com/view/42jxejd8mbtg3n6/BuckD.PNG/file
One more week and slow stochastic will embed on the weekly chart. Much more to go imo.97.50 minimum. Euro looks like it's about to skydive with no parachute.
DeleteNew low in NDX would give a rare trio of shooting star, exhaustion gap, and impulse down. Having said that, we have seen of how little significance such signals have been of late. Liquidity rules the waves...until it doesn't...
ReplyDeleteDespite new NDX low, what I thought 4 does not have the "right look". Might be a 2 even only a 32% or so retrace. Scalper's market!
ReplyDeleteThere is a new post started for the next day.
ReplyDeleteTraderJoe