Overnight the ES futures were roughly 25 - 30 points higher. Before the cash open, they started downward. But the highest that the cash new high reached was less than one full point! Some very weird things are going on in the lighter holiday volume. We're used to that. Below on the ES 4-hr chart is one of a couple of good possibilities. As we've said, it is possible to see wave v at the low.
Yet it is also possible to see a running triangle at this point as well, and then wave v form later. Only a couple more wave termination points need to form properly. And they might happen in the after-hours. The purpose of the running triangle would be to even up the net difference with the second wave in the structure. But because the triangle has a lower ((B)) wave it would still be a bearish formation and not necessarily halt the total decline.
There are other ways for a longer in time fourth wave to form (larger flat?) but so far there no signs of those formations and there is already downward overlap.
Conversely, if the potential triangle is invalidated upwards, then it is more likely wave wave v ended where shown at the low, and this would also end wave (i), down, and price would then more likely be in wave (ii), up.
Have a good start to the evening.
TraderJoe
Thanks so much. If it's a triangle, is it possible it's a B wave with a C to come? Thank you
ReplyDelete'Possible', yes. Likely? Much less so. This is still within the confines of the first downward impulse. Also, the 'First of the Year' money might see the 'automatic inflows'. And, so, with the Bollinger Band beneath, it would be lower probability to call for a C wave here. TJ.
Deletethank you, I do agree it's possible but not probable. However, every time we've lost the weekly 18ma this year, the target has eventually been the weekly Bollinger band which right now stands at 3570 on /ES. The weekly close will be very important. We are also now embedded bearish on the Slow Stoch as well.
Deletealso remember: since wave iii is > i, then v could be 'any length', even longer than iii, etc. right? TJ.
DeleteYes I was thinking maybe an extended 5th. Vix has barely moved but may get over it's 18ma daily today.
DeleteWith the new low below the 'prior' low in blue, we now have a zigzag which is the 'minimum possible' configuration for a ((D)) wave of a triangle. It 'can' go deeper.
ReplyDeletehttps://www.tradingview.com/x/sqeaphOy/
TJ
ES 4-hr: while the chart is (always) a little behind, it does now show that the prior 'b' wave low has been exceeded lower.
ReplyDeletehttps://www.tradingview.com/x/PiE7sq0W/
This is also a bit of a warning, as there is no reason (in a bear market), prices just couldn't 'let go lower' if they want, making a w-x-failure-y. A lot now depends on how quickly the Dow drops.
Just also bear in mind, on the ES 30-min intraday wave-counting-screen there are now 4 consecutive closes below the band, and if this one closes below it, that would make 5, dropping the odds to much less than 5% of staying below the band without a close into the band. Note: 3,812 is about 78.6% of a decline.
TJ
ES 30-min: here is the intraday wave-counting-screen (should be generated by all blog readers each day). Note there is now a c = a, possibly inside a triangle. And there are now five consecutive closes below the lower band, dropping the odds to about 1-2% that the next close will be below the band. This is not impossible, but very low odds.
ReplyDeletehttps://www.tradingview.com/x/kX1Ymqhc/
Also, the c = a is at the 78.6% retrace of the prior wave.
TJ
ES 30-min: closed within the band; resets the number of consecutive closes.
DeleteThank you for sharing your expertise TJ. Please forgive the uninformed question...but does " here is the intraday wave-counting-screen (should be generated by all blog readers each day)." refer to the same Tradingview page "www.tradingview.com/x/kX1Ymqhc/" every time or is there a procedure mentioned somewhere else for new-ish blog readers to generate the wave counting screen every day. Thank you for your patience...
DeleteHi newish Chuck & welcome. Here are the instructions for the intraday wave counting screen, as posted previously.
Deletehttps://studyofcycles.blogspot.com/2022/10/reminder-of-intraday-wave-counting.html
If you need the summary of Ira's rules, let me know.
TJ
Thank you TJ....I have found your 11/2015 Summary of Ira Epstein's rules on the interweb as well as his Youtube channel....Lots to assimilate...but if there is more available please share at your convenience..
DeleteES 2-min: also I would like to demonstrate that in order to get a five-wave 'C' wave here in the triangle, there must have been this diagonal from the high that converted again to an impulse.
ReplyDeletehttps://www.tradingview.com/x/m0BblryE/
Gulp! Doesn't it defy the whole "deep retrace" thing? Well, that's my experience and demonstrated for you in 'real time'.
TJ
P.S. in this case the diagonal is x((1)) and the lengths of the waves are ((5)) < ((3)) < ((1)). TJ.
DeleteES 30-min: after being embedded, the intraday slow stochastic is now above 21, and a return to the 18-day SMA, and / or higher is possible/more probable.
ReplyDeletehttps://www.tradingview.com/x/emJy1pAg/
TJ
ES 5-min: no guarantees, but a > 62% retrace has been made on the up wave since the low. So, it time to watch for a new local high. And remember, especially within triangles, the (C) waves can be 1.0, 1.27, 1.618, 2, 2.27, etc.
ReplyDeletehttps://www.tradingview.com/x/0bo7Tzro/
This might turn into the ((E)) wave of the triangle if the wave doesn't bust apart and fail. And, yes, (C) of ((E)) 'could' be either an impulse or a diagonal.
TJ
Yep, the low did not survive. Tricky darn triangles. Maybe the ((D)) wave is becoming a bit more complex.
Deletehttps://www.tradingview.com/x/Fz4p108p/
TJ
A new post is started for the next day.
ReplyDeleteTJ