Sunday, December 10, 2023

IF the Dow goes over the high in 2023 or early 2024

If the Dow goes over its high in the remainder of 2023 or early 2024, then we need to be completely open minded to the contracting diagonal possibility I have noted several times in the past. As a reminder, it now looks like this on the Monthly Chart of the Dow.


Because sentiment is getting quite bullish, price could retrace down closer to the (B) wave within a few days. But then, a holiday rally might take the Dow over the all-time-high again. For the short term, wave (C) of  should not trade under the (B) wave to remain valid. This is clearly marked on the chart.

Then, IF and only IF a new all-time-high is made one can suggest it might be the larger diagonal that is forming. It may take a while, but the MACD is currently above the zero line on this time frame. So, keep it in mind for now until we know more.

After (and only after) a new all-time-high could there be a fourth wave down, ④ which should overlap in a diagonal wave and might re-test or throw-slightly-under the lower uptrend line. Let's see how this plays out and IF it plays out.

Have an excellent rest of the weekend,

TraderJoe


19 comments:

  1. Yes,possible indeed. Tracking the UST 30 year market? Thanks TJ

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  2. ES 30-min: at 4,617 (DEC, just hit) the ES has validated an expanding diagonal upward. Chart below.

    https://www.tradingview.com/x/kZmLaWeh/

    TJ

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  3. ES 30-min: now that this pattern is validated in the Dec contract, I'm going to roll to the March contract from here forward. TJ.

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  4. FYI...https://www.cnbc.com/2023/12/12/india-overtakes-hong-kong-to-become-worlds-seventh-largest-stock-market.html

    Take out from HK and put in IN.

    What a rally from 27th October low. tomorrow's 8:30 data push can bring it to new highs(https://www.cnbc.com/2023/12/08/inflation-expectations-plunge-in-closely-watched-university-of-michigan-survey.html?&qsearchterm=michigan) OR as IRA says Vix to complacent.

    Any takes Tj

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  5. ES 30-min: here are some thoughts from the ES 30-min intraday 'wave-counting-screen' before the cash open & after the CPI report.

    https://www.tradingview.com/x/mC8QJXJn/

    TJ

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    Replies
    1. ES overlap warning triggered suggesting either 1) diagonal, or, less likely 2) triangle or, 3) completion of up move. TJ.

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  6. ES 1-Hr: to simplify, here is the current 'completion count' with the overlap.

    https://www.tradingview.com/x/N8pgNFwW/

    For diagonal look for "three-down" to 62% or so. For completion count look for "five-down" and a break of the low.

    TJ

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    Replies
    1. A diagonal more likely imo. The turn off the top at this degree of trend gonna be unambiguous I suspect... 😊

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  7. SPY 5-min: can be counted with a triangle, currently.

    https://www.tradingview.com/x/NBN2pp3g/

    TJ

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    Replies
    1. Now up over the Ⓑ wave.

      https://www.tradingview.com/x/dMkOp0RU/

      TJ

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  8. ES 1-Hr: now up over this morning's high. Diagonal or triangle are good options. TJ

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  9. The volatility index, VIX, just hit its lowest level since January 2020. Interestingly, this comes at a time with elevated uncertainty and just before a Fed meeting.

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  10. SPY 10-min: here's an update on cash before the close.

    https://www.tradingview.com/x/mmkE6HDB/

    TJ

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    Replies
    1. note: there is a new overlap warning. TJ.

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    2. SPY 10-min: there is now a new high above wave ③, but wave ⑤ may not be quite finished yet. Will need to check tomorrow.

      https://www.tradingview.com/x/gYdQX916/

      Overall, a triangle or diagonal may still be under construction.
      TJ

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    3. Currently in the wave since this morning's low, c = 0.618 x a; could go a bit further. TJ.

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  11. Weekly bb on spy 468 and on spx cash 4680, looks imminent

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  12. A new post is started for the next day.
    TJ

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