The news let us know more than the market did today. Payroll employment levels beat the consensus, as you probably know by now, and that will likely allow the FED to proceed with QT and interest rate hikes at least as currently planned. The daily chart of the ES futures is below.
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| ES Futures - Daily - Mixed Message |
The reason the market didn't tell us much today is that price made a higher-high, higher-low and lower-close day compared to the previous bar (HH-HL-LC). It is still below the high of three bars ago, and once again, the upper daily Bollinger Band provided resistance to a further rise. So, without making a lower low, the swing line is neutral and bias is still up. And groan: the traditional calculation of the slow stochastic closed in an embedded status today, but risks losing it on Monday. Worse still, there was only one wave down we could count today without a lower low, unless we have a truncation at the low.
The market was really a pain today, even though it declined overall. Much of the decline occurred in the after-hours leaving a sizable gap on the cash chart. And the market again resisted wave counting, making either a leading diagonal lower, or an a wave, down, and a possible triangle. More waves are needed. Just why this is occurring is a feature of this market. It may have to do with the myriad computer systems and algorithms being used to harvest market profits. Or, it may just be a function of the current high volatility level overall (as per the VIX). It could also be a function of making even a further fourth wave more extensive in time. Elucidation at this exact moment is futile.
We discussed possibilities for further upside in the comments for the prior post. You are encouraged to read them. But, today can also be viewed as a failure or truncation day for the ES (the cash SPY may have made a fifth wave higher).
Again, it is difficult to find a clarifying wave-count edge at the moment. But hang on for a bit; the skies usually clear after a while. We certainly hope so.
Have a good start to the weekend.
TraderJoe
ET, I took a screenshot today from Epstein's subscriber ETF video. He actually pulled up his Slow Stochastic settings and I screenshot them. These are the settings: Length 14, KLength 3.0, DLength 5.0. Also remember that he told me previously that he uses an exponential setting.
ReplyDeleteA stochastic oscillator with 'three' parameters is called "Full Stochastics" not "Slow Stochastics", see this reference article. The "Slow Stochastics" has only two parameters.
Deletehttps://school.stockcharts.com/doku.php?id=technical_indicators:stochastic_oscillator_fast_slow_and_full
Either people don't know what they are referring to, or Ira is intentionally confounding the issue for his own purposes.
TJ
I agree with your conclusion ET. May I send the screenshot to you at Elliott.Trader@yahoo.com?
DeleteYes, for this case.
DeleteTJ
SPY (dly)(2x3) - 2 views
ReplyDeletehttps://www.mediafire.com/view/c5axcxa5ngh2ft3/2views.PNG/file
Distance from Average - Here's a short term/longer term view of momentum, and how it might be applied. Perhaps you'll see some of the benefits that these may offer.
ReplyDeletehttps://www.mediafire.com/view/5oc5fome3yyzl0y/DistancefromAverage.PNG/file
Addendum: A few insights from the Oct '18 selloff and subsequent rebound
Delete(dual momentum)
https://www.mediafire.com/view/6kuzp23irnwujw1/SPXdualmos.PNG/file
see 03:38 PM, below.
DeleteTJ
Indices displaying bullish pennants on daily. We should head higher next few days imho...
ReplyDeletepossible .. see tomorrow's post, when it is up.
DeleteTJ
Here is the full-on nested impulse case lower in the Russell 2000 (IWM ETF). These are some factors to consider carefully:
ReplyDelete1. Price is still in the larger parallel channel downward
2. Interior waves made parallel channels
3. Wave 1 is less in price and time than wave (1) and may be a subwave.
4. Wave (2) - or B - is the largest wave and highest RSI after the fall.
5. The make-or-break point is abundantly clear.
https://www.tradingview.com/x/9b89RYwi/
If price starts printing daily closes outside of the channel or more than 23 bars in length then the immediate down trend is likely over as a) price would violate the 0 - (2) trend line, and b) degree violation would result from a larger wave in the time parameter if not the price parameter by then too.
Also, the recent up wave is choppy, and taken with the prior down move looks like the classic "hockey stick" bear flag.
Keep it simpler. 'Use' the right-hand-side of the chart like a weapon.
TJ
P.S. I'm 'waiting' to see if anyone can ask the most obvious and simple of Elliott wave questions about this chart (i.e. Quiz!). Waiting ... TJ
DeleteWhy the truncation
Deletebe more specific as to which/when?
DeleteTwo comments on the IWM chart-
Delete1. Your 5 of (1) is most likely only 3 waves
2. If your RSI is set for default of "close", then your late Feb divergence is not divergence. The late Feb close is higher than the referenced late Jan close.
(5) of 1
DeleteHold on it's 5 of (1) it was typo but actually it's also a truncation the way I typed it. The middle of chart
DeleteNot necessarily. What if it's just the thrust from an ugly triangle? Triangle in a fourth wave position before ending move is 'quite common'.
Deletehttps://www.tradingview.com/x/575jYjXL/
No, there is something much more egregious on the chart.
TJ
Hockey Stick - here's what I learned as being a "hockey stick" price formation.
ReplyDeletehttps://www.mediafire.com/view/3dez3m0fux1y814/HockeyStick.PNG/file
I was referring more to this,
Delete"Bearish Flag Pattern
A bearish flag pattern looks very much like the bullish flag pattern, only with a different orientation. Some may argue that it looks more like a hockey stick than a flag."
TJ