Back-and-forth, whippy price movement. Today was an inside day up that appears to consolidate yesterday's drop. It was an inside day in the ES futures (chart below) that closed higher.
It feels like the market is waiting on news of some kind. With price over the 18-day SMA, the price bias remains higher. The daily slow stochastic is still embedded. Lower daily lows or higher daily highs are needed to provide more information. One suggested count was posted in the comments for the prior post.
Have an excellent start to the evening.
TraderJoe
Good morning, all. From what I can see on the ES 4-hr chart (below), the wave (ii)-to-(iv) trend line has now been breached in less time than wave (v) took to build.
ReplyDeletehttps://www.tradingview.com/x/3QVl4DhF/
TJ
..also..at this moment the daily slow stochastic is not embedded; needs to see if it holds for the day. TJ.
DeleteThanks TJ. Just an observation..the crypto marker was/is leading both the rise and downfall in spx for sometime now. I am observing this from spx 3000 to 4800 and then back to 3600 and then to 4200. Will try to put in a chart.
Deletemanu .. please don't waste your time with crypto charts for this site. They will not be published. I am not interested in short term correlations. Each market is counted on its own, period. TJ
DeleteES 1-Hr: towards mid-day this is what I see so far.
ReplyDeletehttps://www.tradingview.com/x/SW7mSRhY/
1. The 'failed flat' led to weakness.
2. The second down wave is shorter in price and time than the first down wave.
3. The second down wave might, thus, qualify for a sub-wave if it gets to that.
4. Yesterday's decision based on degree labeling was correct.
5. The two down waves are absolutely equivalent until they are not.
Currently, the daily slow stochastic remains un-embedded.
TJ
Joe,
ReplyDeleteI know EW can be applied to many assets, but I was wondering if it was valid for interest rates or treasuries since they are subject to intervention by the fed?
P_T: comments are on moderation, so it may take a bit until they are and published. But I get them all. As to your question, yes, notes & bonds are a very liquid and deep market subject to both human and institutional emotional reactions and EW applies to it with certain caveats. First, the short end of the curve (90-day - 2 yrs) is what is most subject to FED control, so less applicable there. Second, I don't think Elliott, Prechter or Neely ever envisioned 'negative rates'. So, they would be scratching their heads in Europe. And, third, EW, in general, needs a bit of a looking over because how do you get 'negative' oil prices - they really occurred in one contract month - and what do you do with them??
DeleteTJ
Thank you Joe,
DeleteThat being said I have a follow up question. The fed is sending a message regarding increased rates. It seems the majority of the market being too young to remember the 70's first hand is in disbelief. They seem to think fighting inflation will be a quick affair and are pricing in instant gratification and speculating about a pivot to easing which I find amusing.. Without an in depth wave analysis, I was wondering if in your opinion the charts are pointing to which view is a more probable scenario.
My opinion is quite simple and is shown on the chart link, below. 1) Markets 'tend to' or 'often do' move in parallel trend channels, 2) market parallel trend channels tend to be importantly divided by Fibonacci ratios, 3) a zero cross of the MACD 'often' signals a trend change.
Deletehttps://www.tradingview.com/x/3sXsxsWO/
Therefore, it would not be unexpected for the 10-Year note yield ($TNX) to hit a 38.2% retrace 'around' the 6% yield level at some point in time.
TJ