Very Difficult for Retail to Compete

Here is a one-minute chart of the ES futures around the release of the CPI report. What you will note is that the ES futures prices moved 110+ points in literally one minute.

ES Futures - 1 Minute - And 110+ Points on CPI

Yes, we know the big institutions have the news-reading algorithms that read the news and respond to it to move prices. What you see here is an excellent example of why it sometimes makes sense to avoid new reports. Before a human could likely even receive the data, make a decision and respond to it with a mouse-click or two, prices had moved 110 points or more!

While this is clearly the very epitome of impulsivity it also seems to clearly show one disadvantage of the retail trader. Further, after the report, there simply is no retrace of 23%, or 38% - just a complete machine grind that the retail trader is also at somewhat of a disadvantage to deal with.  OK, so the ES moves +110 points, and without a significant retrace we're supposed to buy-in and take the risk that prices won't exceed the low? Right (facetiously).

What you have here is machines making waves and making it extremely difficult for traders to participate. This is again made possible because these "Smart Money" machines, can see the order books, and they know the depth of the market at every instant.

What does this have to do with the wave count? All we can say is that the DOW is dangerously close to invalidating its minute ((b)) wave count. The other three major indices are not. If the Dow doesn't invalidate it's possible the wave count for all the indices is a larger triple zigzag upward. Time will tell.

Have a good start to the evening,

TraderJoe