Best Count at this Time

The form on the ES 8-Hour chart is very suggestive of a contracting diagonal. If so, there have been five sub-minuette waves down to minuet wave (i). I didn't want to miss it.

Note, there are not 120 - 160 candles on this chart so as to make the form of the wave is more apparent to you. Thus, the EMA-13 was used, rather than the EMA-34. However, there is a significant numbered wave on each side of the EMA (and when you use the four-hour chart, the same occurs with the EMA-34).

Now notice this count this provides five waves with the required v < iii < i, and iv < ii with well-defined trend lines. Wave iv does overlap wave i - as is typical - and wave v appears to have that characteristic throw-under of the trend line. The wave is whippy; the volatility is high. 

Further, study of the RSI for this wave shows there is indeed divergence on each numbered wave, subtle as it is. That is a fantastic wave signature.

So we may now be in minuet wave (ii), up. This wave may be a very, very difficult wave. It may be long and tiresome. Or it may be short and sharp. The simplest thing to say about it might be, "it would be great if the daily Bollinger Bands were to wrap tightly around price in wave (ii), perhaps for an extended period, so that a larger extended impulse downward might occur." 

Next, literally any price movement below the current wave (i) would provide that the diagonal is leading. For now, price needs to stay below the highs at 4,200+ to better validate the contracting diagonal. We shall see.

Tomorrow is a report-filled morning, including retail sales, the PPI report, and several others. So things might get whippy again.

Have an excellent start to the evening.

TraderJoe