A couple of days ago, I posted this chart of the Russell 2000 futures. As a 'test' I asked people to tell me what was wrong with the labeling. As usual few responded to the test. And the few that did, missed the larger point.
The test was in the labeling. Notice that the February bottom is labeled as (1). This means an Intermediate degree wave one. Now, look at the red label. The red label is for Minor wave A. The problem in the test is very simple. Two waves of exactly the same length at the same location simply can not be of different degree.
Let me try to verbalize it this way. The label of Intermediate (1) is like a street address. Let's say it is like the intersection of Sunset & Santa Monica Boulevard in Los Angeles which is about 7 miles from LAX airport. It represents a point in the price space and time.
The problem is that the label of Minor A is a totally different street address. It is like the intersection of Melrose and Western in Los Angeles which is about 12 miles from LAX. If you give your Uber driver the wrong location, he or she is definitely going to take your to the wrong spot.
The point is that one of the two degree labels is incorrect at that location. And, if you see an Elliott analysts labeling the same point on a chart with two different degrees, then they don't really know what they are addressing - pure and simple. Let me try to say it a different way: the exact same wave can not have two entirely different degree wave labels. It is illogical to say, "this wave is definitely 20% long", and so it needs to have two different labels. Totally illogical. We don't do this in any other aspect of life.
That's why I said at the outset I had included a quiz.
Well, no one got the simple test correct. This is not surprising. I still can't find any other analysts that are truly interested in the concept of degree. Perhaps some day I will.
Have an excellent start to the evening.
TraderJoe
Just an observation - Given that you cant find any other analysts interested in the concept of degree, would not an objective question to ask oneself be "is degree really that important"? If it is, then it doesnt matter if anyone else is applying it or not. It's only important that you do if it produces results superior to those not employing it in earnest.
ReplyDelete(Personally, what would excite me about EW is to see 3 analysts with the same count.) Perhaps someday we'll both find what we're looking for. :o)
see my comments in reply to mbltca, below. In general, you are a bright fellow and your reasoning is faulty in this case.
DeleteYour reasoning is "Cave men didn't distinguish much besides birds versus mammals. Therefore, 'no one' should care about genus or species."
I expect much better from you in the future. TJ.
I thought this might be worth a ICYMI - TSLA
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IWM - a couple more +s
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ES (5x3) - Updated targets
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There's another problem with your count that you didn't mention, and that's the 4th wave overlap. While most people say that 4 can't overlap 1, the more accurate way to state the rule is that 4 can't overlap any part of 2, which accounts for the situations where 2 is an expanded or running flat, which is exactly what appears in your chart above.
ReplyDeleteThe example u cited the overlap with expanded 2 is permissible as per my understanding
DeleteTo say that it's permissable defies the same kind of logic that TraderJoe uses to create his degree rules. In the case of overlap, when an expanded flat occurs as in the chart above, it means that the downward pressure within the impulse wave is so great that it pulls the circle wave b beyond the start of the circle wave a. When extraordinary downward pressure like that is present in an impulse wave, it doesn't suddenly change to extraordinary upward pressure to cause wave 4 to overlap. That's not how impulse waves act.
DeleteI am not sure abt the pressure and all that logic all i am saying i have seen many cases where 4 has overlapped with b of 2 when expanded and the count still works. Happens in oil quite often
DeleteJust like A of 4th triangle can overlap as long as E doesn't overlap 1.
DeleteI don't follow oil. Commodities have too many external events that can make EWT not practical in those markets. I also don't accept that wave a of a triangle can overlap. For me, these are all examples of trying to force a corrective wave into being an impulse wave. True impulse waves never have to be forced.
DeleteThe reason this matter is up for debate is because Neely has stated it as wave 4 not retracing into the territory of wave 2. Meanwhile, Prechter has stated it as "Wave 4 may not travel beyond the end of wave 1". There is a big difference in the two statements. But Neely has 'also' made statements like, any correction in which the "b" wave is over 61.8% is a Flat. The problem is that Neely made the later statement 'without regard' to whether the initial move down is a ":5" or a ":3". I just don't see how a 5-3-5 where 3 is over 62% can be a flat. By 'structure' it must be a zigzag even if it is 70 or 80%.
DeleteIn the same vein, I'm not sure where Neely reasoned the wave 2 retracement rule. I do see that Elloitt referred to it initially that way, but I am not sure it is fully reasoned. The "good impulse" logic is sound, but is a "good impulse" a true "1" wave, or what about the sloppy "A" wave case? What I am saying is I'm not sure the case of the flat second wave, or "running second wave" has been fully reasoned.
In the above examples, let's assume the overlap is disallowed. There is a very large wave down "followed by another very large wave down". Isn't this the very crux of a 5-3-5 count? Doesn't that almost 'require' the "5"'s be treated as such? I'm not arguing whether the entire structure is corrective or not. (I have said, "we can go over the top again; odds right now are mixed at 45-55% bull/bear.). But what I am exploring is whether the wave 2 overlap can be allowed in the case of an "A" wave, and not in the case of a "1" wave. Do you get the subtle difference? One wave is "in" a corrective structure. The other is "not". I am not trying to force anything. As usual, mblcta just wants to take pot-shots, making himself out to be the greatest analyst on the face of the planet, even though he analyzes no commodities, and literally produces no work on this site.
TJ
Let me state the above, another way: similar to the "Santa Monica & Sunset" logic:
DeleteIf an impulse A wave and an impulse 1 wave are 'exactly' the same, why were they given 'two' different names?
If an A wave is an impulse and a 1 wave is an impulse, but they are different because they have two different names, then doesn't that mean they either 'must have' or 'likely have' somewhat different properties as impulses?
An A wave starts a correction, but a 1 wave starts a larger impulse. Clearly the market conditions in each and sentiment are different at the time, but they are both an "impulse" wave.
Neely refers to a "trending impulse", yet both an "A" wave and a "1" wave start a local 'trend'. But the "A" wave's trend will stop after "C". The "1" wave's trend will go on for many more waves.
TJ
Degree HAS to be important - otherwise EW doesn't make any sense to me. Honestly, when I saw that count I thought wave A was a large A in the 4th wave structure and that meant a lot larger correction. Still a long way to go for me...
ReplyDeleteThe market keeps doing it from the highs. I swear it's not me. I just try to count.
ReplyDeletehttps://www.tradingview.com/x/8gBh1K89/
TJ
Thanks for the clarification, ET. You're question on Wave 1 or Wave A was much simpler for me to understand when you put it like that. It's an interesting question and maybe something that has only recently come up because of the heavy hand of government intervention?
ReplyDeleteI can see how you might think that way, but it turns out there is some unexplored territory in Elliott Wave logic. Clearly, Elliott, Prechter & Neely all knew about "A" waves, but, you know, they don't explain it well. Even the chapter on "Wave Personality" only really states "a five wave A wave starts a zigzag, where a three wave A wave starts a flat". They (Prechter nor Neely) don't discuss how they differ internally from "1" waves. And so I applaud Neely for adding rigor to impulses of "1" waves. I'm just not sure he applied the same rigor to "A" waves.
DeleteTJ
IWM- divergence insights
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There's another (smaller) one in the same area. Do you see it?
DeleteES 15-min: by traveling under 4,130.25, the market has met the necessary requirements to consider an expanding diagonal. And it may be 'leading' as an "A" wave (most likely) or alternatively 'ending' as the triple zigzag. Also, it may not be fully over yet.
ReplyDeletehttps://www.tradingview.com/x/mDOOvP6E/
TJ
ES (5x3) New DTBO, with bear trap prior low
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Note: should a broadening pattern emerge, we could see bear trap/bull trap back to back. A quick 3 box reversal would be the alert of the possibility.
DeleteOIl EIA report at 10:30am. Certainly looking like a B wave may be complete on the daily. The long side is very crowded.
ReplyDeleteapologies, misspelled "Oil"
DeleteWhat I find curious is why more EW analysts don't use assessment of the price pattern to inform conclusion about the most likely count in instances where the count is ambiguous. In the current situation we have sideways price consolidation entered during a short-term uptrend with momentum diveryence at revent lows.
ReplyDeletewhy i prefer looking at stock charts in addition to the indexes. AMD started tanking today before anything else.
DeleteES/SP both ES & SPY now have a lower low (ES chart is behind) demonstrating that the overnight expanding diagonal was, in fact, a 'leading diagonal'. SPY chart is below. It just shows a "gap" {gulp} where the ES's diagonal is.
ReplyDeletehttps://www.tradingview.com/x/Tzxraenl/
Overall count "can be" a-b-c lower, and it can go lower.
TJ
ES (5x3) Short term alert
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DBBO was triggered. Have retraced to 50% (currently).
DeleteRBOB (0.025x3) - Short term peak (or more)?
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ES 15-minute chart update .. note where the prior wave (ii) was in the diagonal or, the prior wave (iv) in the extended fifth wave count.
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TJ
SPY 5-min: tentative new channel; EWO divergence now noted. Watch the recent low closely.
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TJ
How do we know it's abc not 123?
DeleteTriangle on the 15 minute SPY chart? https://www.mediafire.com/view/7vtho2ezap4yuzt/Screenshot_2022-06-08_at_21.08.41.png/file
ReplyDelete'possible' TJ
DeleteSPY 5-min: a barrier triangle now works at the low, and now up over mid-channel line.
ReplyDeletehttps://www.tradingview.com/x/tT1IZNum/
TJ
ES (5x3) - "It could happen" (?) :o)
ReplyDeletehttps://tvc-invdn-com.investing.com/data/tvc_ea3fc0795bdc5317ce7e50dcac36183c.png
BTW, thanks for your observation on FXI the other day. It sure worked out (so far).
DeleteA new post is started for the next day.
ReplyDeleteTJ
I don't think so, if you think there's is measurable distinction between 1 and A then you should not have to tell us a wave could be 3 or 5 when it completes. Im wondering if I see 5 waves, can I look at the first wave and know if entire wave is 1 or A? What about wave 2 and b? Are they distigungishable?
ReplyDeleteSo by looking at wave up wave down you will tell me next wave is c not 3? If it's true then where is evidence in your work? Am I misinterpreting your comments?