Tuesday, January 16, 2024

Daily Reminder

Here's a reminder of the current daily count, and the invalidation levels that apply. If the extended wave-i, (circle-i) count is correct, there is both a high and a low-level invalidation level forming a band of about 300 points.


Any daily higher highs will likely also diverge on the MACD and the RSI.

Have an excellent start to the week,

TraderJoe

39 comments:

  1. SPX 15-min: FED Spkr hit the market at 11 am, if you're wondering.

    https://www.tradingview.com/x/sYp4fvQ4/

    below the low might be an expanding diagonal. Above the wave-counting-stop suggests upside reumption.

    (Fed story at this link: FED Speaker)

    TJ

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  2. Hi TJ

    Any thoughts about an extended 1st?
    https://invst.ly/130m1l

    Thanks!

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    Replies
    1. hi .. this was covered in an earlier post. Pls read the posts since for continuity.

      https://studyofcycles.blogspot.com/2024/01/viable-paths.html

      TJ

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  3. ES 1-hr: ES has that new daily low and is now about 4,781; if below 4,776 it will likely confirm an hourly diagonal. TJ.

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    Replies
    1. which could be part of wave a of a longer wave (ii)?

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    2. Probably more like the end of wave (ii), i.e. the five-wave c wave of (ii) as shown in the link, below. The expanding diagonal (if it becomes that) would be the structure in purple.

      https://www.tradingview.com/x/f5gBQWFC/

      And, yes, as a 'c' wave it may be allowed to fail but is not required to. It is more common to make the new low.

      TJ

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    3. Thanks Tj.

      https://fred.stlouisfed.org/series/H41RESPPALDKNWW#0


      Fed is pumping so much money $147kmillion. What they are upto? Do they really care about inflation or debt?

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    4. BTFP closes in March. Market participants may have used it to justify buying but it is not the QE that fueled the market since 09.

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    5. This is a racket. Banks were gaming this because the rate for the facility was lower than what they could get on deposits held overnight at the FED. They used the facility, parked it back at the FED and took the spread.

      I will post the link if TJ approves.

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    6. https://mishtalk.com/economics/banks-take-advantage-of-a-free-money-arbitrage-opportunity-offered-by-the-fed/

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    7. Yes, there is small benefit to being able to pledge the collateral at par. And there is a small forward arbitrage (all else equal) that began in November when rate cuts for priced in. That said, the stigma against using the window is well understood. It's not worth it. Banks fund all-in at HUNDREDS of basis points below SOFR. That is why they have a deposit base at all. If jumbos are guaranteed (and they are) why would any bank not seeing an ongoing run ever use the BTFP?

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    8. When they close the facility they will just "suggest" to drawing banks that if they cannot fund normally after 1 year of help and an implicit jumbo backstop maybe it is time to raise capital. That will do the trick.

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  4. Love watching the lines.

    https://imgur.com/2MiXC7H

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    1. Banks indeed should be charged under RICO, lol! Their bond portfolio is under water to the tune of hundreds of billions. I suspect they are technically insolvent. What if the FED fail to cut rates. Until just before they did, they were assuring everyone they would not be raising rates, no inflation, you understand... 😂

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  5. ES 2-hr: the diagonal criteria were met in the overnight, so far, with ⑤ > ③. Can still go a bit lower if it wants, subject to invalidation. None-the-less, so far in the ES this is a valid correction.

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

    In the Dow, something else is happening.
    TJ

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  6. SPY 15-min: suggests lowering the wave-counting-stop down to above the 475 level. That would likely confirm the end of the expanding diagonal count.

    https://www.tradingview.com/x/D3t0LUKb/

    There is currently nothing bullish on the chart until/unless the gap fills.

    TJ

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    Replies
    1. Also trading below 18sma. Your fac line in the sand.

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  7. SPY 15-min: some stability at the end of the day. Look to see if 'five-up' can form. The low is important as it is 1.618 x ③. So, a wave-counting-stop is placed there, too.

    https://www.tradingview.com/x/TzKPYw8O/

    TJ

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  8. This is what I have so far from yesterdays bottom.

    https://imgur.com/EDRDHQ2

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    Replies
    1. Putting in some chunky bars on the ES 10 minute like 4's do.

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  9. SPY 15-min: move the lower wave counting stop up one fractal. The upper w-c-s will still serve as confirmation the diagonal is over.

    https://www.tradingview.com/x/n1A803KZ/

    TJ

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  10. So we either finished a c wave of a flat for 4 or I missed an expanding ending diagonal that truncated at 4796.25. The retrace should say something here.

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  11. Seeing something like this on SPX.
    https://www.tradingview.com/x/DqOusqa0/

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    1. No, EDT, your second wave down is highly likely to be incorrect. That is because that claimed, 'smaller degree' (b) wave of ii down - not marked on the chart - is longer in price & time than your entire claimed higher degree i wave. This violates the very definition of degrees. Notice how the diagonal, downward, I provided ended exactly where I stated it was likely to - at the 1.618 extension.

      If you have not listened to this audio interview with Glenn Neely about the "Top 5 Mistakes EW Traders Make ", I recommend you do before you post any further charts here.

      https://www.neowave.com/audiointerviews/201710/interview.mp3 
      TJ

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    2. Thanks for pointing that out ET! I missed that calculation.

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  12. ES 30-min: from the intraday wave-counting-screen. If we are going higher, it may be by expanding diagonal. While the iii'rd wave is longer, it did not make 1.618.

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

    TJ

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    Replies
    1. ES now has the higher high - this allows considering whether the proposed diagonal will validate. Needs v longer than iii. TJ.

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    2. Wave v is now longer than wave iii; diagonal count is validated. Higher prices still possible. (Chart will be updated soon). TJ.

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    3. Here is the chart with the measurement.

      https://www.tradingview.com/x/7O5Vabnf/

      TJ

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    4. I like your idea here because if it was in impulse with a running second wave, it should of had enough power to not truncate on the fifth wave.

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  13. They trotted out Atlanta FED president Bostic to talk up the prospect of rate cuts before July. Traditional Treasury Bond buyers like Japan, China, and Saudi Arabia have been steadily unloading Treasury Bond holdings. Both the debt and deficit are increasing and a non-existent bid on 30YR bonds means 10 YR almost exclusively being floated to fund US government expenditures. This looks to me like a supply vs demand conundrum. I would argue promises and expectations of rate cuts just might be unrealistically pollyannaish. What am I missing? 😊

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    Replies
    1. There was this bit, too, so's you don't get so cynical about the FED. Remember, they are empowered by the people to mess with the markets until we unvote that power.

      https://www.zerohedge.com/political/senate-passes-stopgap-house-freedom-caucus-insists-border-measures

      TJ

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    2. True. Just surprised by how little recognition, even by "smart" people, that "messing" is exactly what they are doing, lol!

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    3. Seems like there trying to talk down rates to provide cover. Does not seem to be working much so far.

      https://fred.stlouisfed.org/graph/?g=TSH7

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  14. SPY 15-min: here is the equivalent in the cash count. Impulse with 'alternation' and no overlap.

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

    TJ

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

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