Wednesday, January 3, 2024

Last Chance Fourth Wave

Below is the ES 8-Hr chart with approximately 140 candles, well within the range of 120 - 160 suggested by The Eight-Fold-Path Method. The EWO has come back below the zero line, still well within the range of +10% to -40% suggested by the method.



This suggests the 'last chance' for a fourth wave is likely building. We can perhaps count one earlier, but its signature does not show up well on the EWO. Let's see how it goes.

Have a great start to the day.
TraderJoe

36 comments:

  1. ES-Daily - a couple of fyi notes: the ES has come back to fight the battle at the 18-day SMA, "the line in the sand". The daily slow stochastic (regular calculation) has lost its embedded status. The only days it could get it back are today and tomorrow.

    https://www.tradingview.com/x/TkvqgqZ2/

    Reminder than the FOMC meeting minutes are scheduled for release at 14:00 ET today.

    TJ

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  2. Contracting diagonal off the bottom on es? We would be in 4.

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  3. SPX getting difficult to count. Below is what I see thus far.
    https://www.tradingview.com/x/tWETRSDi/

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    1. One with Awesome oscillator. (3) is at the lowest reading.
      https://www.tradingview.com/x/M3KXGP2n/

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  4. This is the lowest I can draw the channel. Maybe a final flush to set the trap.

    https://imgur.com/zNEjMkR

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    1. You can see were people tried to buy at the .786 for a triangle that did not work. The total decline from 4841 is not impressive.

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  5. ES 1-Hr: futures probably provide the best guide. As far as I can tell, there was a truncation high for b-3. This 'might' get corrected later. The down move is a five-wave non-overlapping wave in a bullish falling wedge. Wave ③ is the extended wave and is longer than ①. So, wave ⑤ is not really constrained.

    https://www.tradingview.com/x/vMEIt2Qu/

    The prior low on 20-12 was undercut according to the data I have. That is the 'minimum' flat expectation. Nothing is really positive on the chart, though until or unless price starts getting back over the 18-day SMA.

    TJ

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  6. After the down move yesterday towards the end of the day, below is my revised count. We should see some up move from here if this is the end of the correction.
    https://www.tradingview.com/x/QWi8PWP1/

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    1. ..that count is not remotely correct or logical. I can't go into all the reasons why. But readers should ignore it.TJ.

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  7. Biggest trade of all time in SPXL today at the lows. This could be the harbinger for the final 5 wave structure up.

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    1. Please do not provide trading or investment advice on this site. Also, do not provide a record of your own trades. This is a wave-counting-site, not a trading site. TJ.

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    2. It wasn't my trade, I just noted that someone (likely an institution) bought/sold a record number of shares in that ticker.

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    3. Ok. I understand. You were just providing information. Got it. Thanks, TJ.

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    1. Five waves almost up thus far.
      https://www.tradingview.com/x/Vau8b24G/

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    2. Beautiful, five waves up now.
      https://www.tradingview.com/x/wN5ERcOB/

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    3. Just agreeing .. like so, so far.

      https://www.tradingview.com/x/pbESfFP4/

      TJ

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    4. Leading diagonal might be forming.
      https://www.tradingview.com/x/nxziATuF/

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    5. Diagonal was invalidated, abc down might have completed.
      https://www.tradingview.com/x/0MYXm6LE/

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  9. SPY 2-min: the five-waves-up argues for watching to see if the low holds. Now there is a 50% retrace, but the 'time' is kind of short (not a deal-breaker - just an indication the correction can go longer if it wants).

    https://www.tradingview.com/x/Zd9UZRq3/

    Regardless, the 50% correction, itself, allows that a 1.618 extension on a larger time frame could be made. In other words, wave-three should extend. Wave-one is not now likely to be the extended wave in any further sequence.

    TJ

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    Replies
    1. Little leery how that impulse stopped in what looks like a corrective channel.

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  10. i think we have a 4th wave triangle playing to downside

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    1. to complete 1st wave or c (expanded flat being the high as suggested by TJ)

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  11. SPY 15-min: the marginal new low argues that the five-wave-up this morning was the 'c' wave end of a marginally failed Flat, not the beginning of a new impulse. That's why my comment was "the five-waves-up argues to watch the low to see if it holds".

    https://www.tradingview.com/x/BWSWjB3y/

    I've been through this so many times, now, it is almost second nature. But the high of that wave now provides a 'key marker' on the upside.

    Lower is still possible.
    TJ

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    1. With you TJ! This is what I am seeing on SPX.
      https://www.tradingview.com/x/pk6q1MRP/

      TJ how did you handle today's scenario. From EWO perspective we were expecting hold around 50-61.8% and then a bounce. Did you trade the down move after that ? I kept looking for a bounce to trade to upside but it never happened & missed the down move.

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    2. Wave fives are "profit-taking-waves", not trade-initiation waves. Further, daily price was nearing the lower daily Bollinger Band with the Daily Slow Stochastic already in over-sold territory. As Ira says, "over-sold and over-bought levels do NOT usually attract new positions from the Smart Money. They start trimming back." And recognizing the Payroll report was the next morning, I personally played very, very, very lightly - following Ira's guidance - not my wave count. I won some, I lost some, I won more back on some fractal breakdowns. Nothing fantastic. It was a fifth wave in my book and expectations must be kept small because the Smart Money ain't having it. And one could get run-over by a Payroll or other report the next day. (This is my experience only - not trading or investment advice.)

      TJ

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  12. TJ. Is this possible. Be kind, I got enough Nyquil in me to take down a small horse.
    https://imgur.com/5g0cQ8r

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    1. I'm on my phone right now, but I think your second 'b' is longer in time than your first 'x' and that would tend to violate degree definitions. TJ.

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    2. This is the best I can offer in the futures from the workstation, with three points of evidence included in the chart.

      https://www.tradingview.com/x/7j5zbCd3/

      The only rub is ④ within wave iii, but it is shorter in price than ii if it is an overnight triangle, and it 'can be' less in time if it is just w-x-y.

      TJ

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    3. I would say 4702 was the end of 5. Thx again for your response.

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

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