Friday, December 9, 2022

Higher High Day - 2

The ES daily chart made a higher high and a lower close. Today was PPI (Producer Price Index) Day, and the futures were higher before the open, then tanked on the PPI report, then rallied to almost 80%, then fell off again into the close on much higher volume. The daily chart is below.


My understanding of the swing-line indicator is that this allowed the line to continue higher for yet another day - as shown.  A low below Wednesday's low is needed to change to a down-trending rather than a neutral reading for this chart element.

The daily slow stochastic is still in over-sold territory. The Bollinger Bands are still traveling sideways, the swing-line remains trend-less, and price settled under the 18-day SMA, so the daily bias is down again. Today made the fourth consecutive day that prices closed below the lower parallel trend line.

The bumpy and whippy conditions continue. The CPI report is currently scheduled for Tuesday of next week before the market opens.

Have an excellent start to the evening and the weekend.

TraderJoe

23 comments:

  1. Thanks for the update TJ, it looks like things could get interesting next week with CPI on Tuesday and the Fed announcement on Wednesday.

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    1. Similar setup to late may of 2008 - under the daily 18 ma after a similar rally above it for 2 months, then two attempts within days to retake it. After that, the market dropped hard. The setup is similar the result may not be.

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    2. Yikes! Hope this isn't a repeat of 2008. Maybe if China invades Taiwan but my stock portfolio will be the least of my worries. I agree with the similarity also the yield inversion is very scary.

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    3. i doubt it, but by march the media may be saying that, i'll be buying

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  2. Hi TJ,
    I wonder if you might have an opinion about my Daily S&P 500 wave count:
    https://www.tradingview.com/chart/SPX/GhK6pIth-S-P-500-Daily-Elliott-Wave-Count-2022/

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    Replies
    1. Your count breaks 'the rules' because wave 5 is not longer in price than wave 3 - which is a rule for an expanding diagonal. And it 'must be' an expanding diagonal as presented because wave 4 overlaps wave 1. Otherwise, it is just a carbon-copy of my weekly count which was shown at this link on Dec 5 and also much earlier.

      https://studyofcycles.blogspot.com/2022/12/plausible-minute-b-circle-b.html

      If you're going to post charts, please get a copy of The Elliott Wave Principle by Frost & Prechter and memorize the 'rules' for the various patterns. Otherwise, it takes too much of my time to troubleshoot bad patterns and explain why, and I will just delete them in the future, rather than respond.

      TJ

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  3. your last bar is wrong .. es high was 3990

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    1. ira uses only the single month contract dec or march dont look at all like your chart which has combined both

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    2. According to an email from my broker,

      " Thursday is rollover day for the INDICES so you will need to move to March INDICES from the December contract. On Friday the Margin INDEX contracts will have more volume than the December INDEX contracts. "

      So, this is what it looks like, "as traded" if one followed the broker's requirements. I'm very well aware of what Ira does, and I'm also well aware that some people follow their broker's requirements, and some do not.

      TJ

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  4. This chart just notes the recent weekly divergence between the Dow Jones industrial Average and the Dow Jones Transportation Average. The cash Dow has a higher high while the transports have a lower high.

    https://www.tradingview.com/x/roFb33f2/

    TJ

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    Replies
    1. Do you think the gaps S&P and Dow November 10th are important ones to close?

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  5. It looks like the downward expanding diagonal in MSFT might be complete.

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    1. This comment has been removed by the author.

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    2. what time-frame are you referring to? It's hard to read minds. TJ.

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    3. on the weekly timeframe. i retract/correct my previous comment, I meant that wave 3 is shorter than wave 1 which would break the rule. i'm wondering instead if the wave down is a complex correction instead

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  6. https://schrts.co/vFjzJAHR

    Can anyone explain to me what’s going on with put/call ratio. These are buy signals.

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    Replies
    1. I just look at index put/call . Retail has swamped equity put/call with 0dte options. Total casino. Index put calls are slightly elevated but still relatively calm.

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    2. Roberto: could you please post a link to the 'index put/call'? Thank you.

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    3. https://ycharts.com/indicators/cboe_spx_put_call_ratio

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    4. Best guess: with prices stuck at mid-range between the weekly highs and lows, the wild movement represents 'very large' strangle positions. If the market breaks out to the upside the calls become very profitable, and the puts expire worthless. If the market breaks out to the down side, then the puts become very profitable and the calls expire worthless. TJ.

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  7. 18 ma in full force today. Spx qqq and djt all closed near the daily 18, and Vix rallied to it's weekly 18. GS warning people that soft CPI could mean a 10 percent rally, I don't know if that's bait or what.

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  8. A new post is started for the next day.
    TJ

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