Saturday, December 18, 2021

Chop City

The choppy price action since the March 2020 weekly low is still best explained by this wave labeling. An alternate is shown below the price bars, but the alternate has a problem - which makes it the alternate at this time.


The problem with the alternate is that if wave x(1) is the extended wave in price - because the retrace is so shallow, then - usually, most-often - wave (3) is shorter in time as well as price. We are showing it because wave (3) is shorter in price, but it is not shorter in time. That is a conflict which makes it the alternate.

Whereas IFF price comes back down to the parallel in December/January, it might be doing so in an expanded flat wave (overall) which would alternate well in both price & time with the prior Intermediate (X) wave zigzag correction. At present the chart shows (Y) = (W) and that is a 'typical' relationship for corrective waves. 

Another reason for counting this way: where is that unbelievably strong wave 3 of (3) gap up on the weekly chart? Like Sherlock Holmes in The Hounds of Baskerville, we have to at least ask the question: "why didn't the dogs bark?", or - in this case - "why don't we see a huge recognition gap?" Further, we must recognize that the ES futures made a higher high this week. Those who just plot the cash indexes might not be recognizing such at this time.

Lastly, readers of this blog should have the interest and curiosity to plot the FTSE 100, and the DOW/Gold to determine 1) are all stock indexes world-wide making economically driven new highs in indexes at the same time? 2) is DOW/Gold saying that stock indexes are at all-time-highs in terms of real money? or 3) is this wave being driven more by a) free money provided by the government precisely because the economy is not doing well, b) mindless speculation at all-time fever pitch levels, and c) excessively low interest rates allowing an explosion in margin debt balances, and record stock buy-backs by corporations?

You should decide how you see it. You can see the way I am leaning even though I am patient, calm and flexible in what I count day-to-day.

Have an excellent rest of the weekend.

TraderJoe

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63 comments:

  1. GreywaverDecember 18, 2021 at 11:32 AM

    DJI/GC (qtrly) Interesting you should mention the Dow/Gold ratio. Worked up this chart a few hours ago. Just a few observations - nearing decision time

    https://www.mediafire.com/view/b1gjdpy03tjpwam/decisiontime.PNG/file

    ReplyDelete
    Replies
    1. TachyonDecember 19, 2021 at 10:32 AM

      At times it can really be tempting to conclude that fundamentals no longer matter in the face of a relentless liquidity storm unleashed by Central banks. Two things strike me as noteworthy at the moment. 1. But for 5 stocks, NDX would be in a bear market, an extreme narrowness of breadth that I believe is unprecedented at ATH. 2. Three Hindenburg Omens on the clock.

      Delete
  2. GreywaverDecember 18, 2021 at 1:21 PM

    AAPL (dly) - Observations/thoughts -

    https://www.mediafire.com/view/je6aizrw97ptb1h/AAPLd.PNG/file

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    Replies
    1. GreywaverDecember 18, 2021 at 4:59 PM

      Addendum - Possible micro count of 'v' on above.

      https://www.mediafire.com/view/zanqoq8wdwaktww/AAPLmicro.PNG/file

      Delete
  3. Elliott_TraderDecember 18, 2021 at 1:43 PM

    I'm wondering if there are a couple of ways for the DOW to impulse lower yet.

    https://www.tradingview.com/x/WNf008YY/

    While a lower low is needed overall, the ((D)) wave in the barrier triangle scenario is already below the ((B)) wave low. Further, a triangle might correct for degree issues.

    TJ

    ReplyDelete
  4. 458africanDecember 18, 2021 at 2:21 PM

    When I look at a long term Nikkie chart I see a primary B wave in progress from the 2008 low and it has retraced about 66 percent of the complete drop from the 1990 high.
    I believe from the covid low the U.S. markets have completed a B wave also.if I count the waves up in your chart I count 11 waves up and that would complete the Primary B wave...next week should be a very bearish week with the SPX dropping into the 4359 area.We shall see.IMHO

    ReplyDelete
    Replies
    1. 458africanDecember 18, 2021 at 5:31 PM

      Nikkei Long term chart

      https://i.postimg.cc/mgvQJ5Fs/Screenshot-43.png

      Delete
    2. 458africanDecember 18, 2021 at 5:38 PM

      The SPX cash 90 minute chart

      https://i.postimg.cc/sX61dM0h/Screenshot-44.png

      Delete
  5. GreywaverDecember 18, 2021 at 4:08 PM

    SPX (how things may have started) -

    https://www.mediafire.com/view/vblzs98javeshaf/OneView.PNG/file

    ReplyDelete
    Replies
    1. Elliott_TraderDecember 18, 2021 at 4:50 PM

      1. A 'lot' of people out there are making things up so their middle third wave is not the shortest. This chart does the same thing.
      2. From May 1 - May 15 is a correction that is 'longer in time' than the first ii. I guess they don't care about degrees either. It's not 'just' the shorter third wave. It's also about the time signatures - which no one else seems to care about much. Oh well.

      There is no ignoring that at the market's high NQ had a (C) = (A) as I showed last week. And the Dow has a 1.618 exterior Fibonacci retracement on the drop to the 2020 low.

      So, I tend to just ignore all the other noise out there until I see something convincing.

      TJ

      Delete
  6. GreywaverDecember 18, 2021 at 4:33 PM

    NYSE Summation Index - heads up

    https://www.mediafire.com/view/d95kdvld2kzu7rb/Summation.PNG/file

    ReplyDelete
  7. GreywaverDecember 18, 2021 at 4:38 PM

    Commodities vs Equities - Applicable chart "tweet" -

    https://www.mediafire.com/view/tk54pcxo7i1z39t/Tweet.PNG/file

    ReplyDelete
  8. BillDecember 18, 2021 at 6:06 PM

    Chart showing QQQ weekly possible triangle. I'd assume we should have a higher high than what was reached week of 12-6 but also a higher closing price. We do not have a 90% down wave retracing 11-29-21 lows yet, still possible.

    https://www.tradingview.com/x/x0wK1eFC/

    ReplyDelete
  9. GreywaverDecember 18, 2021 at 7:02 PM

    SPX YTD return - From the few comes much

    https://www.mediafire.com/view/m071mpdr0idkkuq/From_the_few.PNG/file

    ReplyDelete
  10. TachyonDecember 18, 2021 at 10:23 PM

    Seems your preferred count anticipates a Z wave up to complete a triple ZZ. Not sure why you think market price action and economic reality are now in any way correlated as true price discovery has clearly long departed this market, and for some of the reasons you yourself cited.

    ReplyDelete
    Replies
    1. thepopeHATESrapDecember 19, 2021 at 2:30 PM

      The ironic thing about the market is that the more hedging takes place, the less chance of a correction occurring. Also, hedging activity leads to short and sharp corrections. Once those hedges come off, price reverts back to the upside.

      Delete
  11. GreywaverDecember 19, 2021 at 11:02 AM

    "Another reason for counting this way: where is that unbelievably strong wave 3 of (3) gap up on the weekly chart?" (noted from above)

    This doesn't seem to make much sense (to me at least). If the 1st wave is the extended wave, and 3rd wave is shorter, why would one describe the 3 of (3) as unbelievably strong, and why would one expect to see a gap in this shorter wave in the first place? Your own chart (Nov 30), shows your 3 of (3) only reaching 1.236 of 1 of (3), hardly an unbelievably strong 3 of (3).

    I think the question you pose (where's the gap) is invalid.

    ReplyDelete
    Replies
    1. Elliott_TraderDecember 20, 2021 at 12:10 PM

      The observation is that those who claim the x3 don't have the gap.

      TJ

      Delete
  12. GreywaverDecember 19, 2021 at 12:42 PM

    QQQs (wkly) A number of observations - [if interested] (click to sharpen)

    https://www.mediafire.com/view/377f90xrp6mo6b3/QQQswkly.PNG/file

    ReplyDelete
  13. TimHDecember 20, 2021 at 9:11 AM

    In a perfect world we get a lower low on SPX and a lower high on VIX.

    ReplyDelete
    Replies
    1. TachyonDecember 20, 2021 at 12:34 PM

      Yes. I t would imply a fifth. ot C wave down completed.

      Delete
  14. TimHDecember 20, 2021 at 9:37 AM

    VIX - gap closed

    ReplyDelete
  15. BBRiderDecember 20, 2021 at 9:47 AM

    Happy Holidays to all.

    How about a running triangle since September for nice XX alternation.

    All I want for Christmas is Triangle, A Triangle, A Triangle.

    ReplyDelete
  16. GreywaverDecember 20, 2021 at 11:23 AM

    4hr - couple hours in -

    https://www.mediafire.com/view/zkmbdjv6xjs4wv7/earlylook4hr.PNG/file

    ReplyDelete
  17. 458africanDecember 20, 2021 at 12:30 PM

    This doesn't bode well for stocks if BTC comes down out of what I think is a weak distribution channel in a 3rd wave lower. IMHO
    https://i.postimg.cc/JnZNYM4Z/Screenshot-45.png

    ReplyDelete
  18. Elliott_TraderDecember 20, 2021 at 2:40 PM

    DJI 15-min: this is what I see in early afternoon. Only three waves up from the low, so far. Watch for overlaps, etc.

    https://www.tradingview.com/x/rtC6DAlk/

    TJ

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    Replies
    1. Elliott_TraderDecember 20, 2021 at 2:41 PM

      ..maybe a flat if forming to extend the correction.
      TJ

      Delete
    2. Elliott_TraderDecember 20, 2021 at 2:52 PM

      Here are the ES 5-min futures up close. The three waves really tells us little. A flat could form. Yes, so could an upward overlapping diagonal, so might be good to let the market figure this out with additional waves.

      https://invst.ly/wxuzf

      TJ

      Delete
    3. Elliott_TraderDecember 20, 2021 at 3:00 PM

      -within the second :5 up, the small diagonal was exceeded lower in less time than it took to form. Let's see if that becomes meaningful.

      TJ

      Delete
    4. Elliott_TraderDecember 20, 2021 at 3:30 PM

      higher high is suggestive now of a diagonal, perhaps still in progress.

      https://invst.ly/wxv8l

      TJ

      Delete
    5. GreywaverDecember 20, 2021 at 3:43 PM

      Does your ((3)) of v have an overlap within?

      Delete
    6. Elliott_TraderDecember 20, 2021 at 3:54 PM

      ..can now be counted as diagonal - just barely.

      https://invst.ly/wxvg7

      TJ

      Delete
    7. Elliott_TraderDecember 20, 2021 at 4:03 PM

      ..see chart note.

      https://invst.ly/wxviq

      TJ

      Delete
  19. TachyonDecember 20, 2021 at 4:45 PM

    Interesting. Wondering how the expectation of a complete re-trace in less than time to form squares with the possibility of a LD. I would assume a deep b or second wave that fail to notch a new low would not obviate the LD possibility...?

    ReplyDelete
  20. GreywaverDecember 20, 2021 at 6:18 PM

    It appears we may have an issue with the progression of your 3:30pm chart to the
    4:03pm chart. Perhaps I'm just seeing this incorrectly -

    https://www.mediafire.com/view/q8roxoia3du4mum/Two_Versions.PNG/file

    ReplyDelete
    Replies
    1. Elliott_TraderDecember 20, 2021 at 9:44 PM

      I keep saying that very compressed waves sometimes have two possible interpretations. But you keep picking at me for it. What you need to consider is all the nano-trades going on in sub-minute time frames. On a practical basis I do not have the time or inclination to get into that degree of 'analysis paralysis' but I can see the sequences that can be interpreted two ways.

      I have said it before: corrections are tough to analyze not just because there are so many varieties of them, but also because their waves are so compressed.

      Please let me know if you do or do not understand this issue.

      TJ

      Delete
    2. GreywaverDecember 20, 2021 at 10:29 PM

      In accounting parlance, we called that whatever it takes to balance (wittb). :o)

      Delete
    3. GreywaverDecember 21, 2021 at 12:25 AM

      Let's take each piece of your response -
      1. Compressed waves sometimes have two poss interpretations -
      a. If these are so difficult to interpret, then perhaps the time frame is
      too small? You chose the time frame to present.
      b. So you maintain that we can't always tell the different between a
      corrective structure and an impulsive one? Are these the two poss
      interpretations cited? That seems to be a big problem.
      c. On your 3:30 chart you went to a lot of trouble to point out the
      micro counts on three impulsive waves, and even labeled them as :5s.
      Didn't seem to be any ambiguity shown or cautioned about.
      d. Then, with subsequent price action, it morphed into the 4:03 chart.
      Noticeably, there were no longer any micro counts.
      2. Corrections are tough to analyze ...
      a. Im under the assumption that an impulsive 5 wave move within a
      correction is subject to the same rules/guidelines, etc as one
      with the trend (in other words we can have a 1,2,3 or a,b,c.).
      So, identifying an impulsive structure within a correction should
      (in my mind) be no different than if not in a correction. And once
      again, there didn't seem to be any issue of identifying them within
      a corrective structure on your 3:30 chart. So, that seems to
      nullify the correction point offered.

      I don't "pick" at you, I simply question (as I would any expert in EW) as to how it is that a stretch of price action can "change" from impulsive to corrective. As differentiating these is the whole underlying foundation of EW, then perhaps you can appreciate my frustration. Having a corrective structure change from one type to another is one thing (I can understand that), but having it change into an impulsive structure ("3" to "5", [or "5" to "3"]) is, in my mind, a foundational problem.
      That's the best response I can provide. I've tried to objective in addressing your points.

      Delete
    4. Elliott_TraderDecember 21, 2021 at 6:58 AM

      You really have not been objective or listening. Some are straightforward. Some are not. When you have a wave which becomes 'impossible' to count using the rules, then it simply 'must' be something else. Period. I will not analyze sub-minute waves; yet they are being made all the time. So, when I see such a situation I quickly adapt and adopt the legal count. Period. You can make of it what you will or not. I think right now you are again being in 'stubborn' mode, and not in listening mode.

      TJ

      Delete
    5. Elliott_TraderDecember 21, 2021 at 7:20 AM

      ..and @02:52 I even warned with the compression I was seeing in the index, a diagonal 'could' form instead of a flat. It did. But I noted it 'before' it happened. You didn't. No one else did. They certainly didn't post so here. So, IF you thought the 'only possible result' from the 5-3-5 up was a next massive wave down, one would have been incorrect: that is the inflexible way people without experience in counting waves act. One of the problems is 'how' waves start from the low. They start on 'some' timeframe. Let's call it a 'nano' timeframe. The free tools do not have the ability to show those waves, and neither does my cheap-ass brokerage account quotes. So, I am at a disadvantage when it comes to the computerized quants who have the co-located servers. But I think it is still valuable to have an idea of what the reasonable legal possibilities are from a point in time. You may disagree.

      TJ

      Delete
    6. Kelly ODecember 21, 2021 at 8:10 AM

      GW and Joe: It seems to come down to whether you agree with Joe's rules and guidelines. Since Joe has not published them in a comprehensive summary, and occasionally makes changes to them, they are hard to follow.

      GW: For me, and I'm sure others, it would be really helpful if you included indicator labels in your chart screenshots.

      Joe: If you collected and published your rules and guidelines as you said you were going to three years ago, there would be a lot less conflict. People would have to follow them, or move on.

      Thank you.

      Delete
  21. GreywaverDecember 20, 2021 at 10:42 PM

    NYSE Fang Index (dly) - key TL break

    https://www.mediafire.com/view/x4vetnt8v4s3fjn/FangIndex.PNG/file

    ReplyDelete
  22. GreywaverDecember 21, 2021 at 12:55 AM

    USOIL/GLD (2wks) - 5 waves, extended 1st ?

    https://www.mediafire.com/view/suvufw62t12mwgk/USOIL-GLD.PNG/file

    ReplyDelete
  23. Elliott_TraderDecember 21, 2021 at 11:04 AM

    SPY 5-min: it's not an impulse until a non-overlapping fourth wave lower is completed, and a fifth wave higher is made. Otherwise, as the chart suggests for a deeper correction it could be a multiple zigzag IFF a higher high is made. IFF a higher high is not made we are left with a/b/c.

    https://www.tradingview.com/x/TCe8iff6/

    I favor the a/b/c count due to the exceptionally short down wave.
    TJ

    ReplyDelete
    Replies
    1. Elliott_TraderDecember 21, 2021 at 11:08 AM

      ..first breech of shorter channel to the upside.
      TJ

      Delete
  24. Elliott_TraderDecember 21, 2021 at 11:57 AM

    SPY 5-min: can now be counted as five waves up in an impulse larger (a)/(i), for now.

    https://www.tradingview.com/x/XmoBrQnU/

    TJ

    ReplyDelete
  25. christiangustafsonDecember 21, 2021 at 3:10 PM

    There's a plausible five-wave move down off FOMC on the spoos -- will Biden announce a new lockdown or something nuts tonight?

    ReplyDelete
    Replies
    1. Roberto MattheusDecember 21, 2021 at 4:37 PM

      I had a similar count. I could see Biden threaten non-complying States in some way, or give some mandatory vaccination timeline which we know would never work in many states. Then there's the wildcard of Russia- Ukraine switch the media has forgotten about. Thanks for sharing

      Delete
    2. jacksparrowDecember 21, 2021 at 10:05 PM

      Could be a c wave of wyz or just wy

      Delete
  26. BillDecember 21, 2021 at 7:09 PM

    First signs of trend change? MMFI first fractal is not a buy fractal because it isn't above the alligator's red line (teeth 8 period line).

    https://www.tradingview.com/x/SduXi4DF/

    ReplyDelete
  27. GreywaverDecember 22, 2021 at 12:02 AM

    SPX (dly) Possible running triangle 4th?

    https://www.mediafire.com/view/t743k867fhxof2k/triangle4th.PNG/file

    ReplyDelete
  28. BBRiderDecember 22, 2021 at 11:22 AM

    Only problem I see is the length of time in 5.

    https://imgur.com/3YN0u58

    ReplyDelete
  29. GreywaverDecember 22, 2021 at 11:31 AM

    SPY (dly) We currently have the bullish version in play -

    https://www.mediafire.com/view/7uw6c120en8c6s6/AB.PNG/file

    ReplyDelete
  30. Elliott_TraderDecember 22, 2021 at 12:33 PM

    SPY 15-min" MACD says, "keep counting higher" with it's higher high. And all of this started with that dastardly diagonal.

    https://www.tradingview.com/x/z5hWXKrv/

    TJ

    ReplyDelete
  31. GreywaverDecember 22, 2021 at 1:55 PM

    SPY (30m) top of 12/17 gap reached (filled).

    ReplyDelete
  32. GreywaverDecember 22, 2021 at 2:15 PM

    Trendline options - [if interested] -

    https://www.mediafire.com/view/opr5j5wimv0q80k/TLs.PNG/file

    ReplyDelete
  33. marcDecember 22, 2021 at 4:14 PM

    No mention of island reversal on spx this week, that would be the launch of iii of 3, don't even need a chart

    ReplyDelete
    Replies
    1. Elliott_TraderDecember 22, 2021 at 4:41 PM

      Interesting because your last one didn't work out, but you failed to tell everyone it didn't.

      TJ

      Delete
    2. marcDecember 22, 2021 at 4:51 PM

      I'm not predicting anyway, I'm just saying that those things have significance in the count as far as getting the psychology right

      Delete
  34. Elliott_TraderDecember 22, 2021 at 4:14 PM

    'Can' be counted as most or all of a 'five-up' with a divergence now.

    https://www.tradingview.com/x/reU8EP19/

    TJ

    ReplyDelete
  35. Elliott_TraderDecember 22, 2021 at 5:14 PM

    There is a new post started for the next day.
    TJ

    ReplyDelete

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