The higher daily high - after an outside reversal day down - might constitute a trap for the bears. There isn't a good way to tell, and price is not yet over the 18-day SMA, the 'line in the sand'. That being the case in terms of the Elliott Wave Count, this one comes closest to meeting the rules and guidelines. I need to emphasize, I do not know that this count is correct. It 'is' suspect.
IFF we've made an expanding diagonal downward, then it is being followed by a flat wave. Again, to emphasize, this count BEST fits 1) the expanding trend lines, 2) the EMA-34, with numbered waves on every side of the average, and 3) the Elliott Wave Oscillator shown below, and also mimicking the expanding pattern.
And, IFF the pattern is correct then the only way I can think of that it might work is that the net distance traveled by the b wave of wave (v) is less than the total length of wave (iv).
This is a key reason that I do not know if this count is correct. I have not run into degree labeling situations of this type before in the past, so it will be a learning experience for me as well.
Have a good start to the evening.
TraderJoe
You asked me about b of (v) the other day as I had posted the same count. On ES, "b" is 1.25 pts longer than (iv). Nevertheless, it still appears to be the best alternative as you have suggested.
ReplyDelete..ya; a good question is why are these counts so messy?
DeleteTJ
Perhaps this would be a fair time for discussion - Let's assume someone is wanting to learn EW in detail. As it is (to some degree) rule based, one would want to first find a listing of all applicable rules (ideally it would be somewhat shorter than the USGA's list, lol).
DeleteNext, are these hard and fast rules, or are they in reality guidelines? Next, who created these rules. Elliott, or someone else's interpretation of Elliott, or someone on their own. For example, X should overlap "a" of W. Is this a rule? guideline? Who created this? Elliott? Prechter? Someone else.
Degree violations of various types. Are all of these rules? guidelines? Who created them? Elliott? etc, etc.
All of these should be set out clearly in some form of reference book, paper, etc so a new "student" can see the premise upon which the theory operates.
Also, just as with the USGA, rules can actually change given time and new circumstances. Can this be said of EW? Are some rules once seen as necessary now subject to change (for whatever reason)?
These are just a few of the things that one might wish to have addressed if wanting to pursue applying EW theory in practice. Im sure others would have additional questions. If all of this information were clearly stated at the outset, then perhaps there would be more agreement among EW practitioners as to counts given the identical price action being analyzed.
Just a few thoughts (fwiw).
I do know what you are trying to say. A detailed reply would take a book. I will summarize by saying, Elliott stated all were 'tendencies'. Frost & Prechter tried to make it more quantifiable by developing 'rules and guidelines'. Neely tried to make it more rigorous by providing extensions, and a charting method. Bill Williams tried to make it more tradeable.
DeleteWhile there is no substitute for reading and thoroughly understanding each of their original works - which I have done - I can see the benefit of someone assisting with clarification and personal experience.
It is interesting though, how - even this morning - the Dow's futures hourly chart is showing all of Elliott's tendencies to a "T".
https://www.tradingview.com/x/c7oTykmg/
This includes a current Fibonacci relationship of 1.618. This is the market viewed through the lens of all three: Elliott, Frost & Prechter, & Neely would agree with this construction. They would all "err" on the side of a third wave in progress with the 1.618. The only question is whether a fourth and fifth wave forms properly - and one should 'err' on the side that it will.
Now, corrections, diagonals, triangles, etc. are where the patterns get messy. That is the nature of corrections. One does one's best in the latter as the compression, multiple double-tops & double-bottoms are what wreck havoc with wave counting.
Hope this helps.
TJ
This move from ath want enough yet to be longer than prior wave down. Very close, so new low would be meaningful, in other words market went down as far as it could without making longer leg down
ReplyDeleteHang Seng (mthly) - two perspectives
ReplyDeletehttps://www.mediafire.com/view/yfkd22b4uh83lzp/HangSeng.PNG/file
expanding ending diagonal from 11/29 to lows retraced in less time than took to form is probaly the bull count
ReplyDeleteWe likely see a repeat of 2019 with December new ATHs but being a down month. They will be unable to paper over the awful market internal the looming Evergrande global disaster imo.
DeleteI think month ends up
DeleteAAPL (2day) - current (click to sharpen)
ReplyDeletehttps://www.mediafire.com/view/fro9mactb8kyeux/AAPL2d.PNG/file
Hi TJ,
ReplyDeleteA newbie in EW. Saw our post from June202
http://studyofcycles.blogspot.com/2020/06/trillions.html
"And, if we are in Primary ((B)), up, the market can go almost where it will, again. This is The Fourth Wave Conundrum at Cycle Degree now, and larger, and the conundrum happens at every degree of trend."
1) Still you think its a B wave ? If not, can we have a long term chart from 2009 to understand.
2) Fundamentally if trillions were pumped in then no one can predict a medium term top of the market.
3) Is thr a study which follow fundamentals and EW together?
Ew is very interesting and really good understanding reading your posts and links.
https://www.mcoscillator.com/learning_center/weekly_chart/an_oversold_10_trend_of_daily_a-d/
Thank again.
Good morning all. SPY cash still living within its channel, and can be counted as five-up. Further, we 'could' just be in a 'b' wave of a larger fourth wave. Or, the current up wave can go further.
ReplyDeletehttps://www.tradingview.com/x/7c5dXmvu/
What is really difficult to ascertain is which is the longer wave x1 or x3? Wave 1 can be considered as having ended at two locations. The futures seem to imply x3, which means a longer fourth wave is possible.
TJ
Here is that x3 option and longer fourth wave potential in the ES futures. The high would still be waiting on a larger RSI and MACD divergence.
Deletehttps://www.tradingview.com/x/gQZcQwJy/
TJ
..this latter option considers most/all of the overnight action as a 'b' wave since little of it showed up in the cash market.
DeleteTJ
Courtesy of SentimenTrader -
ReplyDeletehttps://www.mediafire.com/view/vgnmbb15smz6lu6/DvSmoney.PNG/file
IXIC/SPX (3mth) - Something worth monitoring.
ReplyDeletehttps://www.mediafire.com/view/zkr79lkhjac5fk9/IXIC-SPX.PNG/file
https://schrts.co/TJmYawbs
ReplyDeleteThis is worth watching over the next few years. 2/10 year is only 3 rate hikes from inverting. Any thoughts.
ES 1-hr: lower channel line (of first channel modification) has been made, but not a 38.2% retrace.
ReplyDeletehttps://www.tradingview.com/x/chRbJppi/
TJ
That’s a long SLIM JIM, lol
DeleteSome of the leaders have 5 waves up this morning fyi AAPL HD crazy market.
ReplyDeleteSPY 5-min; new local high by 0.01, so far.
ReplyDeleteTJ
This pace is exhausting :o)
ReplyDeleteSPY 5-min: not sure if it's done yet, but these are the internal structures I was watching today that best line up with the hourly ES.
ReplyDeletehttps://www.tradingview.com/x/XE9495vN/
The hourly ES may try to take out the highs in the after-hours so that the counts are in-sync.
TJ
TJ -
ReplyDeleteI lost track of the larger degree count on ES, are we working on wave b of 1 and now setting up for a c of 1 of a potential leading diagonal? If yes, lots of chop coming for the next few months, particularly if it turns out to be a contracting diagonal.
Thanks
There is a new post started for the next day.
ReplyDeleteTJ