Outside Key-Reversal Day Down

From the highest high in the trend count, probably the high of the Minor A wave, up, today made an outside key reversal day down, as shown in the ES daily chart, below at the cash close.

Although Amazon and Apple earnings are not out yet, this is also accompanied by the loss of the embedded status of the slow stochastic and a close approach to the 18-day SMA at this time. The only day the embedded status can be regained is the next day (tomorrow's close).

The high of an outside day down should not be taken out within the following two trading days or it can constitute a trap for the bears. With this in mind, it bears watching the impact AMZN and/or APPL may have on the count. Further, the tomorrow is the first of the new month with possible inflows from the usual passive sources, so some sort of correction may result.

If price starts significantly trading down through the 18-day SMA, and closing there, then the Minor B wave is more likely underway.

Have an excellent rest of the evening,

TraderJoe

Copper Tariffs and Earnings

One more trip over the high is possible yet not required. The black and the red count below are equivalent until they are not by The Principle of Equivalence. This is the SPY 4-hr CFD. Prices today were whipped about by the FOMC results, the imposition of 50% tariffs on copper, and by mega earnings after the close.

It is possible that Minor B started today, but we must watch into tomorrow as the institutions might want to bite on the mega earnings news. The red count allows another trip over the high. But the wave counting remains ugly with few good true impulse waves. So, we will learn what we can from wave invalidations or resistance points.

Have an excellent start to the evening,

TraderJoe

Three

After three daily closes above the upper daily Bollinger Band, price today made a higher high, a higher low and a lower close. The three closes higher than the upper band dropped the odds to about 3 - 5% of today's close being outside the upper band, and it was not. (While the futures are still trading as this is being written, we think it likely represents the 4 PM EDT settlement time of the futures.)

Note that the daily swing-line indicator is still up with higher highs and a higher low over the 18-day SMA. The daily slow stochastic is still embedded. And until the red line of the slow stochastic closes under the 79 level it is possible there are some pros (or Smart Money machines) that might still try for a higher high against the upper band again.

From an EW perspective today we counted a possible non-overlapping fourth wave down, (iv), as an Expanded Flat. So, a fifth wave up, (v) is possible tomorrow. But, being Tuesday it could also be a turn day, as well.

It is likely that the prior swing-line low of 6318.75 would be of interest as it might indicate the end of an uptrend, and, if broken, would likely be below the 18-day SMA.

Have an excellent rest of the evening,

TraderJoe

Waiting Patiently

We promised in our last video that if additional waves higher were made this week, it would require a reconfiguration of the Minor A wave higher. Here is that reconfiguration, Essentially, we dropped the degree of the contracting leading diagonal one degree to minuet degree, symbol (i), composed of the five sub-minuette degree waves, symbols i-to-v. Then minute ⓘ is composed of the five minuet degree waves symbols (i)-to-(v). This count has the additional benefit that minuet (b) is shorter in price and time than minute ⓘ, the previous higher degree wave in the same direction, preserving degree labeling definitions.

ES Futures - Daily - Minor A Reconfiguration

In this configuration, Minute wave ⓥ and Minor A now has a new limit shown on the chart of 6,633 because again the third wave in the futures is shorter than the first wave. 

Critical note: since minute ⓘ is now an impulse, and the leading diagonal is only a minuet degree sub-wave, it is possible for this minute ⓥ wave to be an ending diagonal because it is at a different degree. So, it can either be an impulse or an ending diagonal wave. So, first we will show the current SPY 1 Hr chart in the impulse configuration as another extended first wave, at minuet degree, 

SPY Cash - Hourly - Minute ⓥ Impulse Configuration

We are showing this configuration as the extended wave (i), symbol x(i), because minuet (ii) is only a 38% retrace on the first up wave as shown by the Fibonacci ruler on the right. As you know by now, this is highly characteristic of extended first waves. We note that for the SPY, the lower wedge trend line has not even been broken yet!

As an alternate, we can drop the degree one level for the diagonal configuration as below.

SPY Cash - Hourly - Minute ⓥ Alternate Diagonal Configuration

If a diagonal does form, then we would expect a 50 - 78% retracement of the entire up wave for minuet (ii). In that case, the attack on the lower trend line would fail rather dramatically. Although the preferred case is the impulse, because it is simpler, the diagonal alternate is noted for completeness and as another way to extend the Minor A wave in time as the diagonal would have to extend and further cycle through waves (i)-to-(v) yet again.

Have an excellent rest of the weekend,

TraderJoe

Suggestions

Today, on the SPY hourly timeframe we were watching the Fibonacci 162% external retracement on the three-wave down wave that occurred on 16 July. It's the upper red line on the chart shown. Prices over-ran it slightly but nothing to be very concerned about yet. The SPY Cash 1-Hr chart is below.

SPY Cash - 1 Hr - Some Suggestions

There were two possible indications of a top: First, the potential extended fifth wave of c/iii with this wave shorter than a/i. Second, there appeared to be a diagonal forming that we counted in real time. So, the current up count, if it holds could be a,b,c to a (b)-3 wave. Such a (b)-3 wave could be for an expanded Flat or a triangle.

But we don't know upward movement is over. There are still no downward overlaps, nor the undercutting of any significant lows, yet.

So, watching the trend line sketched in, if prices respect it and make a higher high, we will probably conclude there are five-waves-up at that point, and configure the count with Minor A at the new high.

If, on-the-other hand prices breakdown significantly, and perhaps back-test the trend line and fail, then we could likely be in either an expanded flat or triangle scenario. These are very testy waves at this point, and we must just count what we see going forward. At least we have some ideas of the like possibilities.

Have an excellent start to the evening,

TraderJoe

IF Today's High Holds

In the SPY cash index, IF today's high holds I am only pointing out that there would then be a 138.2% Fibonacci relationship with the prior three down waves. I am doing my best to count by legitimate 'fives' and you can see where I've done that explicitly on the chart.

But whether because of overlap or because the time relationships would otherwise seem too bizarre, there is a point where they don't work well. So, this structure could be (a)-3, down, and (b)-3, up. Today's tiny higher high in cash, still not over that 633.94 level, is on a whopping MACD divergence.

There are diagonals galore in these counts. You can see two of them in the space of a week in the above chart. But, if you want to see the count proceed by fives to the extent possible, then as far as I can tell, that is what's involved.

The above count does - if it holds - mean that the Minor A wave may have finished on 15 July, and we could be into the Minor B wave now.

Have an excellent rest of the day,

TraderJoe

Video Update - July 20, 2025

Here is a brief Elliott Wave weekend update video which is designed to take less than ten minutes of your time, compared to some updates that can take an hour or more. As always, hit the full-screen icon on the video player to see the detail in the charts.

I hope you enjoy the content and look forward to seeing what the next week in the markets brings.

Have an excellent rest of the weekend and beginning of a new week.

TraderJoe