In a previous post, (13 August 2023 at this LINK) we noted that according to The Eight-Fold-Path Method on the weekly chart, the US 10-Yr Yield had likely made its minor wave 4, now at the lower left, and started its wave Minor 5, up. We said, it would be a question of when the fifth wave ends. Now, with 135 candles on the daily chart, the Elliott Wave Oscillator has again gone below the zero-line indicating a fourth wave at the one lower degree, minute-iv (or circle-iv). Here is the daily chart.
Some points to note follow.
- Wave minute-iii (circle-iii) is 1.618 x wave minute-i (circle-i) and is the extended wave.
- Wave minute-iv (circle-iv) is a little greater than a 38.2% retrace at prior wave iv.
- All we know is that minute-iv has 'sufficient length in price'.
- That means only that minute-iv could take much more time if it wants (flat, triangle?)
- Minute-v (circle-v) could easily become the length of minute-i (circle-i).
This would suggest that rates would top out around 5.25 - 5.50% (or more). And Minor wave 5 should end on a weekly divergence, as minute-v (circle-v) should end on a daily divergence.
Only time will tell, but that is what the method suggests at this point. The Eight-Fold-Path-Method is the featured post of this site and appears at the upper right of the main blog page. This is the second post this weekend and if you have not read the first one, you may wish to read it now.
Have an excellent rest of the weekend,
TraderJoe
Thanks, TJ, for your on going enducational efforts.
ReplyDeleteI have a question of the eight fold path method of isolating impulse waves, in relation to a-b-c (blue circles in prior chart) corrections following a three wave move complete wave a (bold.) How to tell the difference in an a (blue circle) pullback and a wave 4 (circle?)
Looking at a 30-min chart of SPY/DIA/QQQ over the past 10 days (130 candles) the EWO pulls back modestly below the zero line and now positive again with EWO peak potentialy diverging in magnitude.
If the a (bold) completed early last week and we're now in a b wave (blue circle) of a larger b wave (bold) correction, we should see a c wave as you showed in the prior chart to complete b (bold.)
If, however, the rally on Friday was a v wave of (1, or a?) then we should a larger 3 wave a-b-c pullback in wave 2 (or B) So a full a-b-c correction rather than a smaller finishing up c one.
What tips the scale between a (bold) to b (bold,) and the up wave on the cusp of completing a 5-wave impulse move (which can be a bullish 1 or bearish C.)?
Thanks in advance of any reply.
The issues are these: 1) it is 'not' possible to remove all risk of trading, so 2) there 'are' times when alternatives are acceptable/reasonable/plausible - the fourth wave is 'plausible' in the scenario you suggest. But where is wave one & two? Wave two doesn't go below the zero line? 3) Remember, although an 'a' wave can be an impulse, it can also be a diagonal. Therefore, on shorter term charts (30-min) one realizes that because the wave structure itself can be ambiguous (diagonal v impulse for an 'a' wave) one might not expect the same degree of agreement to TEFPM as when the third wave extends. The 10-Yr yield chart above is 'daily' and it is a 'portion' of a chart which is weekly. And both time frames show the third wave extension. Now I know the argument about 'markets being fractal' and therefore the thought that 'all time frames should work'. The problem is in reality one is dealing with vastly different numbers of players for different time frames. Weekly and daily charts begin to better evidence 'mass psychology' with players from around the world being involved. Intraday charts can be a much different subset (like - one hedge fund's machine on a particular day, or five traders that need to exit their futures after the close to trim their margin exposure). I call this problem 'sampling error', or the 'voting problem' and it is where the fractal theory of markets is less robust, making wave counting a bit more vague at times - especially on smaller time scales. Hope this helps.
DeleteTJ
SPY 15-min: gap lower, so far and bounce off of prior high with tiny overlap. The first link shows the current count.
ReplyDeletehttps://www.tradingview.com/x/LC4jKaqj/
In terms of just being flexible and open-minded, here is another alternate in addition to the one suggested above which assumes we've gotten all the Frikken 'b' wave we're gonna git.
https://www.tradingview.com/x/ZpL1qfxR/
This is just to have a 'plan B'.
TJ
SPY 15-min: gap lower, so far and bounce off of prior high with tiny overlap. The first link shows the current count.
ReplyDeletehttps://www.tradingview.com/x/LC4jKaqj/
In terms of just being flexible and open-minded, here is another alternate in addition to the one suggested above which assumes we've gotten all the Frikken 'b' wave we're gonna git.
https://www.tradingview.com/x/gSHgOe7s/
This is just to have a 'plan B'.
TJ
to help with overall analysis if look at aapl, i am not that the recent down move was a ld (so one more down to come atleast) or was it a and then flat and then c.....now going up. that may give clarity on a big picture
Deletetypos..first case in aapl ..ld and now upward retrace second case in aapl we had a then extended flat b and then c now going up in 5th
ReplyDeleteSPY and ES over the high. Plan B.
ReplyDeletehttps://www.tradingview.com/x/wcdrudw1/
TJ
another ed in play?
ReplyDeleteBB is 4480, we'll get there no doubt
ReplyDeleteIf I was the market and wanted to mess with most participants, I would do an es weekly barrier triangle.
ReplyDeleteand then a Neely failure wave
Delete5 min gold flag?
ReplyDeletesince it's acting like a C wave, I'm wondering about this on DJI. I assume it still needs to go a wee bit higher but every index is at BB resistance now. Forgive me if it's way off. https://tvc-invdn-com.investing.com/data/tvc_9779d55d78ee36439a07d57c25ce3530.png
ReplyDeleteis minute-iv now extended?
ReplyDeleteA new post is started for the next day.
ReplyDeleteTJ