The daily wave chart for the ES Futures is shown below. Please note that wave Minor 4 already consumes more time than wave Minor 2 (the daily close of 3,965 is not shown as it is less than the threshold for another zigzag). Wave 4 in an expanding diagonal is supposed to consume more time & more price than Wave 2. So, everything makes sense at this point.
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| ES Futures - Daily - Wave Chart |
Also shown on the chart are the minimum level of 4,168.25, the target level of the upper declining diagonal trend line, and the invalidation level for the wave. Wave Minor 4 may not exceed the high of wave Minor 2 for the pattern to remain valid.
Of interest are the Elliott Wave Oscillator (EWO, AO) divergences on the minute ((c)) waves compared to the minute ((a)) waves, and the lower overall level of the EWO for wave Minor 3 versus Minor 1. It is acceptable for the EWO on wave Minor 4 to exceed that of Minor 2. In fact, if that happens, it just expresses the expanding nature of the pattern (as long as invalidation does not occur).
Within wave Minor 4, we are not yet certain whether the minute ((a)) wave is complete already, or if it is trying to form a contracting leading diagonal to consume more time. Either is acceptable for this pattern, but the latter is preferred for reasons of the internal wave count. Forming a whippy contracting leading diagonal for the minute ((a)) wave might also reflect a whippy session on Wednesday when the Federal Reserve announces its interest rate decision. It may also reflect the position of the daily Bollinger Bands.
Have an excellent rest of the weekend.
TraderJoe
Thanks again for your analysis. How deep a retrace could be expected in minute ((b)) of Minor 4? Feels like many might believe minute ((b)) to be the start of 3rd wave down...
ReplyDeleteWelcome. Even 'assuming' a contracting leading diagonal forms properly, and we haven't 'already' seen the minute ((b)) wave low, then I'm assuming you know this question is impossible in Elliott Wave analysis to answer precisely. So, you will have to take the market risk at the time (or not). 'B' waves in zigzags can be anything from 14% (if there is a triangle B wave of the zigzag, which is unlikely if preceded by a diagonal due to alternation) to 38 - 78% more typically. Most likely the 90% level should not be reached as that would 'tend' to indicate a flat wave, rather than a zigzag, but even that doesn't absolutely rule it out.
ReplyDeleteEven so, there are some scenarios, that I have outlined below that are worth watching.
In the chart below, the daily fractal marked minuette (ii) is worth watching. It may become a 'trap fractal'. That is, it would be exceeded lower to get everyone uber bearish, and then spring up to the new highs. Possible.
https://tvc-invdn-com.investing.com/data/tvc_1642d51805081b72e99e59e85bab424a.png
But it is also possible for the minute ((b)) wave to become a 'Flat' wave itself rather than just a simple zigzag or triangle. That possibility is also shown on the chart. in such a situation, there could be a false breakout new high, followed by a more severe dump as shown. A flat B wave in a zigzag is definitely allowed by the rules. It is a pattern that would serve to confuse a lot of market participants.
There simply is no way to avoid this risk. B waves are notoriously intractable.
TJ
Thank you for your thoughtful and comprehensive answer to a complex question. Appreciate it, and the education as well. 4th waves require great patience
ReplyDeleteSPX (cash) - Targeting via the 1 box, 3 box, and 5 box reversal charts. (note that
ReplyDeletethe 3 and 5 box do not show verticals, which could be added. 1 box charts do not utilize verticals) - (click to sharpen)
https://www.mediafire.com/view/gzt43nvdxjweqwt/spx135.PNG/file
For those interested, I found a link to a relatively recent & free Glenn Neely video that is tough to unearth.
ReplyDeleteNeoWave Video
I found the video interesting enough to watch. I certainly don't agree with it all, or all of his methods. And - you know how he says "other people's wave labels are changing all the time, and his don't?" - just watch him move his 'd' wave label at one point in the video - live.
One thing I am wondering now is in the S&P500. Will the 'last wave' in his neutral triangle be what I am seeing as the Minor 3 wave in the above chart. Just something I am tracking.
TJ
Do you agree with his statement that one should start a count by looking for the "large" and "violent" price action and it "has to be" a wave 1 or wave A?
DeleteFor the purposes of my analysis, above, I do. I believe he said, "1, A, 3, 5, C, or E" for the wave choices. My weekly chart is below. Regardless of how you analyze it, the fact remains that the first (X) wave from the lower left - whether one or two bottoms - is the longest corrective wave in terms of price.
Deletehttps://www.tradingview.com/x/jfBzAhzk/
So, the January wave down is definitely longer in price than either of the (X) wave locations. And, if the first (X) wave is the double bottom as I think it is, then it is also faster in time, making it "more violent". It also breaks a very significant multi-touch trend line.
TJ
He did mention those as the wave choices for a large/violent move but subsequently at 8:40 in the video he said the large/violent move has to be wave A or wave 1. Also at 38:53 when someone asked how do you look up a starting point to analyze Neely said to look for the large/violent price action and then referring to the gold chart he has on the screen, he says the large/violent price move has to be wave A or wave 1.
DeleteDavid, c'mon: clearly a third wave can be "larger" (and maybe more violent) than a first wave. In the seminars, when he is trying to get through the material he often speaks "fast & loose". He is getting a lot older now and his patience is wearing thin. He covered all the options once. Those are correct, (e) of a regular EW expanding triangle is the largest in the pattern, etc.
DeleteTJ
I get it. As I continue to revisit the video and his charts along with your contributions I'm gaining more of a "birds eye view." His book is something I haven't fully read/digested yet. Cheers!
DeleteTSLA (wkly)(10x1) - Observations [if interested] (click to sharpen)
ReplyDeletehttps://www.mediafire.com/view/cm8zl1mib9azbpv/TSLA10x1.PNG/file
Long term rates are sitting on the break(down) level - potential reversal at hand?
ReplyDeletehttps://www.mediafire.com/view/sh54omuzg4mdwc7/30yryldA.png/file
DXY - Long term target area - 149-154
ReplyDeletehttps://www.mediafire.com/view/5zlbnsm4vlopy9m/DXYLT.PNG/file
Note the nice inverted H&S in the early 90's
DeleteAgain, I worry about the proper setting of "market context" from these posts. These seem to be mostly an arithmetic exercise in price projection rather than an actionable report. Look at the chart below.
Deletehttps://www.tradingview.com/x/jB3cuSTJ/
In other words, I wouldn't post such a long-term price expectation until price was above the channel and had beaten the 1.382 (-to 1.618) external Fibo retracement level, especially with such a huge tail on the monthly candle.
You can continue to do this, but in my humble opinion it is very analogous to saying, "You need to 'be careful' because the Sun is projected to become a Red Giant and will swallow the earth in 4 billion years", without also saying, "Oh, yeah, we human might render the planet unlivable through Global Warming or nuclear holocaust in the next 100 years". For me the context of your analysis is missing as good as the calculations might be. TJ.
From my readings on PnF, the context is that of reversal (bases, tops) and subsequent continuation (re-accumulation or re-distribution). I'm not sure what else there can be. You can certainly have short term occurrences within a larger context (like multiple "time frames"). If a distributive top (shorter term) suggests a turn back down, then perhaps the measures I showed will not be reached. Or perhaps they'll be reached 7 years from now, or 10... Just as the 109 level was reached (determined in 2014). PnF is not EW. To me, its about accumulation/distribution, and continuation in between. If one can't deal with the idea that a targeted area has no time limit, then yes, it could be problematic. Not sure how else to say it. Until the 71 low is breached, those targets remain active. We can certainly have many others in the meantime. Targeting is done from closest to furthest, and with confluence if possible. Just as I showed earlier with the 1box,3box, and 5box targets. There were close ones, and those higher. One might ask, why show the higher ones?
DeleteBTW, I really enjoyed the Red Giant swallowing the earth in 4 billions years analogy, lol. Of course, Flash would have long ago saved us from such a dire end! He'd save everyone one of us!
SPX - So you targeting not being in the proper setting of "market context" like this?
Deletehttps://www.mediafire.com/view/dt12mhhxkt93g9v/Context.PNG/file
Seriously? OK. I let you have your say. But here's what I could do with the USD chart. I could just target the prior high at 121, or I could target the all-time high above 160. And I could give a tinker's darn about what happens between? No chart boxes needed. No calculations needed. Nothing. Do you really think I don't know that PnF is not Elliott Wave? This is an Elliott Wave blog. The posts allowed are those that offer related technical analysis and help support or refute a wave count. I'm done with this topic.
DeleteTJ
6-20 ES - a look back
ReplyDeletehttps://www.mediafire.com/view/lphazmbz7xybiae/6-20.PNG/file
No, you have sublimely missed the point again. I precisely allowed those posts because they were in the current market 'context'. They were talking about what might happen 'locally' that is in the current days/weeks even though they presented a view 'opposite' to the nested 1-2 count. Notice that little '5' in the upper left hand corner of this chart? I have even complimented you several times on the 'good work' and 'interesting perspective' these sometimes/often bring. Just don't post a chart saying the USD is going to it's all-time-high without telling people 1) what time frame, 2) what could happen in between. It's disingenuous. Again, I am done with this topic. Understand what I am saying, and don't push me.
DeleteTJ
RNP (0.10x1) - A case study in progress
ReplyDeletehttps://www.mediafire.com/view/wwh1b6bgz3redl9/RNP.PNG/file
ES 30-min: pre-cash open. Here is the intraday wave-counting screen with updated daily pivots and local fractals. A 62% retrace has been registered, it could go higher (say to 78.6%) but not over the 4,016 high and maintain a local downward count.
ReplyDeletehttps://www.tradingview.com/x/gOCYATQs/
Friday, we counted the down wave as a five.
TJ
ES 30-min: here's an update after the open. Chart is not up to the minute.
Deletehttps://www.tradingview.com/x/pKeGpWh4/
Price has whipped upward, already. Keep an eye on it.
TJ
SPY 5-min: the blue count is that the correction is done at prior red iv.
ReplyDeletehttps://www.tradingview.com/x/52NhcuZf/
The new red count is that the correction wants more time and price in the cash market.
TJ
SPY 5-min: there is a higher high. So the new blue count takes over for the old red count. This assumes a five-wave move for blue c (shown). The new red count is a w-x-y combination count.
Deletehttps://www.tradingview.com/x/AkvMXEjh/
TJ
An aside - for those following Silver, a couple levels of interest -
ReplyDeletehttps://www.mediafire.com/view/7mz5wek4r3nrkxm/silver0.1x1.PNG/file
SPY 5-min: too many downward overlaps. Simplifying count to the red count.
ReplyDeletehttps://www.tradingview.com/x/MtiRqAGq/
TJ
Up wave now 'takes more time' in cash than down wave. Time ruler shown.
Deletehttps://www.tradingview.com/x/WVP7cu3n/
TJ
SPY 5-min: did we have a 'z failure' ? If so, weak market.
Deletehttps://www.tradingview.com/x/kVosu18J/
TJ
new down leg is 'too long' to be included in a diagonal count (as say a four vs a two) by the rules. It 'might be' a B wave lower, but not below Friday's low.
DeleteTJ
ES/SPY undercut their opening lows. TJ
ReplyDeleteES touches 90% of prior low. B wave of Flat, or next impulse lower. TJ.
DeleteA new post is started for the next day.
ReplyDeleteTJ