Below is the daily chart of the ES June Futures contract (close only) showing the plausible sideways triangle count.
%202023_05_06%20(9_27_36%20AM).png) |
| ES Futures - Daily Close - Potential Triangle |
This count is suggested at this time (rather than the upward diagonal count from the B wave low) because usually the first wave up of a diagonal occurs over the prior high (the A wave) to show its character as a motive wave. That has not happened yet. So far price has stubbornly refused to stray too far from the 78.6% retrace level of the B wave down. If price does break the A wave high, we will keep our options open and flexible. But further, the third wave in a diagonal is required to make a higher high, and it has not done that yet, either.
Meanwhile, the daily MACD is drifting near the '0' line, which many times is the sign of a triangle. As always, the triangle invalidation level in this count is above the A wave. Also in favor of this count is that in a triangle either the C or the D wave is the complex leg of a triangle. This extremely complex sideways and time-consuming wave seems to fit for a C wave. Remember, the very purpose of triangles is to move price sideways and consume a lot of time.
The D & E waves shown are placeholders only. The D wave might typically be expected to retrace 78% or more of the C leg. That would be a summer swoon scenario. Often, trading gets light and sloppy in the summertime as volume dries up and the big players get busy polishing their yachts before the sailing season begins, and others take the kiddies on summer vacations in general.
IF the triangle plays out, it would be the "running triangle" variety, with the lower B wave, and it would signal a decline following the completion of the Intermediate (B) wave.
Have an excellent rest of the weekend.
TraderJoe
I see you have an alternate "1" down in the "plausible" triangle scenario. While you did not post an alternate "2" at triangle completion (for obvious reasons), I would have thought the proposed triangle would also obviate the alternate "1". The wave would have to be "A". Thanks for week-end post!
ReplyDeleteWelcome. And we agree that IF the triangle forms properly, then the only option is (A), down. But the triangle hasn't formed properly, yet. So if a diagonal forms for C, then the (1) is still on the table. But your understanding of wave structure is getting better & better. Congratulations and keep it up. TJ.
DeleteGreat mentor and teacher! 😊
ReplyDeletetks!
Delete(From CNN) - I don't endorse it, but you should know about it.
ReplyDeleteChatGPT can pick stocks better than your fund manager
TJ
Be careful with ChatGPT. It was trained on data through 2021. So it doesn't know much about the current bear market. I asked Chat if it had been updated recently ...
DeleteWizard29: A while ago, you were trained on data through the year 2021. Is that still true? Or has your model been updated with more recent information?
ChatGPT
As an AI language model, my training data is constantly being updated to ensure that I have the most recent and accurate information possible. However, my knowledge cutoff is still set at 2021, which means that I was trained on data up to that point. Since then, I have not been updated with any information beyond 2021. Nonetheless, my programming allows me to provide helpful and informative responses to a wide range of questions, even if they are not based on the most recent data.
So chat gpt says "btfd", great
DeleteRe: ChatGpt. Again, though I don't endorse it, if data is through 2021, then it knows what a 1929-32 decline is & a 1974/5 decline is as well as 2000-2003, and 2007-2009 and the Covid decline as well. Sounds like it's got some meat on the bones. TJ.
DeleteWizard:
DeleteWhat do you think would be the five best common stocks to hold over the next year?
ChatGPT:
I'm sorry, but as an AI language model, I cannot provide financial or investment advice. The stock market is unpredictable, and the best approach to investing in stocks depends on various factors such as an individual's financial situation, investment goals, risk tolerance, and investment horizon. It's always best to consult with a financial advisor who can provide personalized advice based on your individual circumstances.
Same question to Google's Bard:
Here are five of the best common stocks to hold over the next year:
Tesla (TSLA): Tesla is a leader in the electric vehicle market, and it is well-positioned to continue growing in the coming years. The company has a strong balance sheet, a loyal customer base, and a rapidly expanding product lineup.
Microsoft (MSFT): Microsoft is a leader in the software market, and it is also expanding into other areas, such as cloud computing and gaming. The company has a strong track record of innovation, and it is well-positioned to benefit from the growth of the digital economy.
Alphabet (GOOGL): Alphabet is the parent company of Google, which is a dominant force in the online advertising market. The company has a strong track record of growth, and it is well-positioned to continue growing in the coming years.
Apple (AAPL): Apple is a leader in the smartphone market, and it is also expanding into other areas, such as wearables and streaming music. The company has a strong brand, a loyal customer base, and a rapidly expanding product lineup.
Amazon (AMZN): Amazon is a dominant force in the e-commerce market, and it is also expanding into other areas, such as cloud computing and streaming video. The company has a strong track record of growth, and it is well-positioned to continue growing in the coming years.
It is important to note that these are just a few of the many stocks that could be considered good investments over the next year. It is important to do your own research before investing in any stock, and you should always remember that past performance is not a guarantee of future results.
Meanwhile, Seeking Alpha's Quant Model says (scale is from 1.0 = strong sell to 5.0 strong buy):
TSLA - 3.15, AAPL - 3.46, GOOGL - 4.90, MSFT - 3.49, AMZN - 3.45
META - 4.99
Bard's pick's average around 3.75, which is good but not great.
Wizard likes: TSLA, META, MSFT
Nice post, thanks!
DeleteIs this triangle a lot like the one that Mike Oak published on this site 3 months ago?
ReplyDeletehttp://studyofcycles.blogspot.com/2023/02/tentative-new-channel.html?showComment=1676066567230#c8046300518839475340
The triangles are similar; they would have to be if a triangle forms properly. Not sure about the additional conclusions. But, in any event, I gave the count some praise then and will reiterate it. It's only a matter if the triangle happens or it degenerates into only a double or triple upward zigzag. Time will tell. TJ
DeleteI went to the Berkshire meeting as i live near Omaha. i've gone apprx 10 times. Nothing really earth shattering. Buffett will never say with strong conviction what he thinks the future holds but he hinted more some trouble for banks. which means pain to come soon for banks. He said Apple stock is better than any business he owns. raised concerns about the amount of money printing from fed & govt - not a surprise. ** side note - my daughter was friends with Buffett's granddaughter in high school. kinda cool. been to Buffett's house but never inside.
ReplyDeleteBuffett also said most of his companies will earn LESS this year than last year. higher interest rates are an anchor for earnings.
DeleteAnd worth noting that BRK now has $127 billion cash sitting on its balance sheet and used relatively little of it buying back stock this quarter. That speaks volumes.
DeleteES 1-Hr: I would begin to watch the 38% retracement level, and see if the EWO can better approach the zero line. This is an hourly chart with many fewer than 120 candles in the impulse, so you may want to refine the timeframe down to 30-min or 15 min.
ReplyDeletehttps://www.tradingview.com/x/s3x5De0W/
TJ
P.S. the C wave's 5th wave might go into the Tuesday 'turn-around' day and CPI report? TJ.
DeleteES 1-Hr: much closer to 38%, and EWO closer to zero.
ReplyDeletehttps://www.tradingview.com/x/bGAlkWAB/
TJ
ES 1-Hr: before the CPI report on Wed there is now a hit on 38%, with the EWO below zero, and the overlap warning is shown. If overlap occurs before the new high, the construction might become w-x-y instead of a-b-c.
ReplyDeletehttps://www.tradingview.com/x/HdZsysKd/
TJ
Having a problem getting over 4148 so far. Pretty easy read if we can't - double topping at 4148 = target 3950 area. Fingers crossed.
ReplyDeleteDo not fear, WR is here. 4147 was a w1 minor, then w2 should hit around 4086, then w3 around 4247, cool some for w4 and head to big dog, Golden .62 = 4315 area for w5 / P5! (or maybe not). I will give it Bulls rule above 4047 (as most would agree)
ReplyDeleteA new post is started for the next day.
ReplyDeleteTJ