Local Count - 2

Based on the ES hourly chart, and The Eight-Fold-Path-Method, we must allow for some more volatility under the 18-day SMA before a lower low is potentially made again. Here is the chart. The degree labels are for relative indication at this time and are just for illustration. They will be modified later.

ES Futures - 1 Hr - Divergence on EWO

We note that wave 2 was a triple complex wave ⓦ-ⓧ-ⓨ-ⓧ-ⓩ, stalling and stalling and stalling before giving way to a third wave, lower. From what I can tell, the ⓩ wave truncated slightly.

With about 145 candles on the chart, the Elliott Wave Oscillator indicates wave ③ of 3 at the low point and wave ⑤ of 3 at the divergence. We need to see if a fourth wave and a fifth wave are made with proper form. As it stands, the third wave, 3, did not exactly make the 1.618 Fibonacci extension, but it is very, very close, and nothing says there can't be more down movement in the overnight.

Then, it becomes important to see if upward overlap occurs or not in a fourth wave. 

Speaking of overlap, we noted today on the daily chart below, that the third up (green) fractal back from 22 March was indeed overlapped at the 4,073 level. This was mentioned as a second target in yesterday's post. Here is the chart.

ES Futures - Daily - Overlap Warning Triggered

The presence of the overlap now makes upward wave counting extremely, extremely difficult according to the rules.

Have a good start to your evening,

TraderJoe