Earlier in the day this chart was posted. If we are in a contracting diagonal upwards, these limits may now be calculated for the move. The limits are now possible because we can count a five-wave-sequence up from the low (see the second chart, below). This chart uses the SPY 8-hr time frame.
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| SPY Cash Index - 8 Hr - Potential Diagonal |
In a contracting diagonal, wave minute ((v)) must be shorter than wave minute ((iii)). That means the limit for the up move if it is to be a diagonal is at 487.64 basis SPY. Right now the other wave lengths are acceptable. Wave minute ((iii)) is shorter than minute ((i)), wave minute ((iv)) is shorter than wave minute ((ii)) and wave minute ((iv)) overlaps wave minute ((i)). While wave ((ii)) is just short of a 62% retrace in the SPY, it is not in the Dow. Further, in the SPY wave ((iv)) is greater than a 62% retrace.
Further, we now know the down side limit for wave minuet (b) of minute ((c)), it may not travel below the low of wave minute ((iv)). If it does, and there is not a new high first, there is a potential for wave minute ((v)) to fail.
The ES hourly chart can currently be counted as being in five wave to wave minuet (a) with the first wave as the extended wave in the sequence, as follows.
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| ES Futures - 1 Hr - Likely Wave (a) |
Whereas today's down move appears to be in three waves. The down move has already traveled wave to the wave iv of one previous degree, but keep in mind that "b" waves can be tough to nail down. For example, with three waves down, the (b) wave could be a triangle, or it could be a flat to take more time relative to the up wave. More insidiously, the (b) wave could drop further in a grinding double or triple zigzag, making it more difficult to gauge. It is suggested that the Fibonacci retracement levels might be a useful aid to help determine if an when the down move is over.
Once again, price may not move below the low shown on this chart and still maintain a count of a contracting diagonal upward.
Have an excellent start to the evening.
TraderJoe
TJ, could an alternate count have Dec 3 as start of expanding diagonal 5th, or is this unlikely given 2nd & 4th waves within this count are shorter in time than the preceding 1st and 3rd waves?
ReplyDeleteSee https://imgbox.com/PHPe4W29
Not impossible but less likely because in a true expanding diagonal iii would also take 'more time' than i. I know people just think about price and not about time.
DeleteTJ
Thanks TJ,
ReplyDeleteIf b wave below 4566 then we can safely assume failed v and the top may be in?
Assume: no. Consider? Yes.
DeleteSafely: no. Carefully? Yes.
TJ
A few potential seasonals this year -
ReplyDeletehttps://www.mediafire.com/view/abhvk5k2fu8f2fc/seasonals.PNG/file
Interesting Grewaver. Tha3
DeleteAt this time, wave iv on the hrly chart above has yet to be fully retraced.
ReplyDeleteRephrased - wave v has yet to be fully retraced (to iv).
DeleteES & SPY 5-min: reached 90% to legally qualify for a flat wave.
ReplyDeletehttps://www.tradingview.com/x/lSAUhmnI/
TJ
SPY opening gap closed @471.04
DeleteTJ
..updated SPY 5-min chart for reference.
Deletehttps://www.tradingview.com/x/zUEWSKFu/
TJ
DXY (dly/wkly) - nearing potential support (click to sharpen)
ReplyDeletehttps://www.mediafire.com/view/1xqhktkshjzhpg6/DXYd-w.PNG/file
ES 1-Hr: wave iv of (a) broken lower. Wave 'a' of possible (b) broken lower.
ReplyDeleteTJ
Yesterday's missed pivot tagged.
ReplyDeleteIt sure looks like 5 waves down from the ATH in SPX. Also, the final move up could be an "extended 5th". What does the book say about extended 5th waves? The retracement will find support at the bottom of the 2nd wave. Bingo! The low was right at the bottom of the gap up on 12/21. The book says the retracement is either complete or the first move down.
ReplyDeleteHi Bob .. it would help if you could clarify what you are seeing as the extended fifth with a chart. Link to a photo, TradingView or Investing.com are easy ways. Thanks,
DeleteTJ
https://imgur.com/HrdPDQe
DeleteHi Bob.. please see this link. There may be some confusion on your part as to what you think the extended fifth wave means.
Deletehttps://www.tradingview.com/x/J3P2aRFd/
TJ
An extension does not imply the longest. It merely means a wave subdivides. The book is clear on this. In fact, an impulse can have 2 extended waves both of which can't be the longest. See the section "extension" in Chapter 1.
DeleteThe count 'bucks the odds' because the 'vast majority of waves have only one extension'. Not saying it's impossible. Also, where would your wave four be?
DeleteTJ
Bob,
DeleteHow will be it drawn if goes below wave 2. Extended v and failed ?
Pages 68 and 69 of EWP explains it
Deletehttps://imgur.com/ku6ta5F
https://imgur.com/1dUKB4u
TJ, I like to count crosses of the 34 ema. On the daily, count the crosses and you get a very oddly shaped impulse with the 4th wave a running flat. Perfectly legal in EW. I'm not saying that's what it is, but if a top is in, then it works for me. My count is that we are in (5) of ((5)) of III. But I still don't see a minor 4 on the monthly. The 34 ema on the weekly and monthly have not been touched since 2020.
DeleteBTC (2day) 3PDh - Very close (but no cigar [yet?])
ReplyDeletehttps://www.mediafire.com/view/wwmyundr3vucq1o/BTCclose.PNG/file
Very interesting article from McClellan - Bond CEF A/D line
ReplyDeletehttps://www.mcoscillator.com/learning_center/weekly_chart/bond_cef_a-d_line_showing_liquidity_problems/
Thanks GW,
DeleteQuantitative Tightening ... music slowing ... to stop?
https://www.reuters.com/markets/stocks/live-markets-retail-investors-pile-into-stocks-record-levels-2022-01-13/
ReplyDeleteYet Reuters reports largest investor inflows. Watch what they do, not what they say.
TJ
From BarChart, currently 67% of Nasdaq stocks are 20% or greater off their 52wk highs.
ReplyDeleteES/cfd (hrly/15min) - current look
ReplyDeletehttps://www.mediafire.com/view/k9a22qv0n62mfa7/EShr15m.PNG/file
Steep descent - perhaps we have another 4,5 to come?
DeleteThe article said they were buying both (noting TSLA, etc.). I'm not sure how you get the conclusion they are selling stocks to buy ETF's.
ReplyDeleteTJ
DJI (dly) A dash of harmonics - [if interested]
ReplyDeletehttps://www.mediafire.com/view/mh95gkjs523iobh/Butterfly.PNG/file
Good morning all. Here is an ES hourly chart update. Nothing is written in stone yet, but the 'potential' diagonal remains in tact.
ReplyDeletehttps://www.tradingview.com/x/6PytBarI/
There appears to be five-waves-up off the lows. Watch to see if a retrace holds. Trading above the down trending parallel shown would likely indicate upside.
TJ
TJ please correct me if I am wrong but I think the correct word is wedge as opposed to diagonal as wave iv does not overlap wave ii
DeleteTJ...unless you are referring to the potential diagonal on the 8hr above not the (a) on the chart within this comment.
DeleteYes, the potential diagonal in the 8 hr chart, above.
DeleteTJ
SPX - C = A = 4512 from ATH. Assuming we break recent lows.
ReplyDeletecfd - (hrly/15min) - odd
ReplyDeletehttps://www.mediafire.com/view/56rkkb7rbd5ydcv/1-15..PNG/file
CVI (wkly/dly) - update and observations
ReplyDeletehttps://www.mediafire.com/view/ct1p1njjhftnx52/CVIwd.PNG/file
DJI (dly/hrly) - observations
ReplyDeletehttps://www.mediafire.com/view/jb6axoj72zp73hi/DJI.PNG/file
The Jan 10th low on YM was exceeded today (not yet on cash).
Deletethx for that .. might have missed it as I was watching other stuff.
DeleteTJ
SPXcfd showing new low for today
ReplyDeleteDJI has a missed wkly pivot in the 35,565ish area.
ReplyDeleteK (m/d) - off to a good start [if interested]
ReplyDeletehttps://www.mediafire.com/view/antbsqvdokxnay1/Kmd.PNG/file
Addendum: A closer look at the daily suggests that (e) was itself a triangle
Delete(barrier), concluding in mid Dec (rather than as noted).
There is a new post started for the next day.
ReplyDeleteTJ