Just a chart today with the wave label degrees continued from yesterday. We don't know wave v is over yet and it could become longer than iii.
Wave v can still be whippy, so care, caution and flexibility still needed. The outside day up is valid unless the low is exceeded in the next two trading sessions.
Have an excellent start to the evening,
TraderJoe
For the last several posts I cited a likely downward mess - which we were treated to. I said there was a good possibility of making a diagonal. I think we did. As the chart below shows, there is a way to count a 5-3-5-3-5 expanding diagonal in the ES 4-Hr futures - done and complete.
This count would have the form (v) > (iii) > (i), and (iv) > (ii) with wave (iv) overlapping wave (i) and not traveling beyond the end of (ii). The main reasons for the count are the size of wave (v), and the precision by which wave (iv) was longer than (ii) but did not exceed it.
I have dropped the degree one degree for the time being and see the whole wave structure as a minute ⓘ wave. Alternatively, the whole structure is the Minor A wave, also done and complete - depending on which degree it turns out to be. The downward sequences are "5"'s and not "3"'s, and the upward minuet numbered structures, the parenthesis ( ) structures, are zigzags as they are required to be. Wave ii is a flat - which is acceptable in the impulse portion. The only element which raises question on the count is that (iii) is shorter in time than (i), while it is longer in price. But then, (v) is much longer in time again which seems a reasonable trade-off.
The trend lines are nearly perfect, and when I look at the whole structure on the daily chart, it just looks a little small to be the whole Minor A wave. I could be wrong about that. But no one knows what is coming tomorrow - not me, not you - so we'll see how the waves do.
There is nothing that forces the adoption of this count yet. There is still a way to consider a truncation high and wave (iii) at the bottom, but there isn't a great Fibonacci ratio in that count either. So, this fits best at the time, though I do reserve the option to see if it impulses by making a new divergent low first.
Have an excellent start to the evening,
TraderJoe
The ES 2-weekly chart is below with a reminder of what can be the big picture: we may be forming a 3-3-3-3-3 Contracting Ending Diagonal at Primary Degree.
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| ES Futures - 2 WK Close - Potential Contracting Diagonal at Primary Degree |
This count sets a specific invalidation in that price should not go over the current all time high before overlap with wave Intermediate (1) occurs. The overlap is expected in this case. Further, the lengths of the wave structure should be (5) < (3) < (1), (4) < (2) with (4) overlapping (1) without traveling below the low of wave (2).
Why? Because often a diagonal pattern signals that a market that has gone too far, too fast, and is near the end of a longer-term wave. And Primary ⑤ - if it forms properly - would be the end of a Cycle V wave.
Have an excellent rest of the weekend,
TraderJoe
In keeping with the theme of this wave being a real mess, I felt the best way to deal with it going into the weekend was to greatly oversimplify the count as the wave internals can be counted numerous ways.
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| ES Futures - Daily Close - 'Possible' Parallel |
Bottom line: we are looking for the Minor A wave down, composed of five minute-degree waves. But, as this point - whether an impulse count or a diagonal count, there is insufficient retrace in the ES futures to allow us to place a fourth wave at this time. We do not 'know' the third minute wave is over, so it could go lower.
The ES price got down below the lower daily Bollinger Band and pierced the 100-day SMA in the overnight news regarding Israel's actions. Then, during the cash session today, price weaved around on both sides of that average, closing just slightly below it, and below the lower daily Bollinger Band for the sixth consecutive day.
We note that with 14-daily candles the RSI is not solidly in over-sold territory yet. "A" waves can be pretty atrocious so caution and flexibility are warranted until there are some clearer wave patterns and retraces.
Have an excellent rest of the evening and start of the weekend.
TraderJoe
Today marks the 5th consecutive day that the ES June futures have closed below the lower daily Bollinger Band as per the chart below. The close today was 5,049.00 compared to the lower band at 5,050.67 and this drops the odds to 1-to-3 percent that the next close will be below the band. In Ira's public videos he claims the most he has ever seen is seven-in-a-row.
However, of interest, the ordinary calculation of the daily slow stochastic has now attained embedded status on the downside.
Also of note, in any one of a couple of fashions, there are enough waves down to claim the Minor A wave has been made. And, yes, price could still attain the 100-day SMA and not ruin the count.
Another item is for certain. This decline since 01 April is already longer in price & time than the December 2023/January 2024 decline, and therefore it is of a higher degree. Remember we labeled that decline as minute ⓑ, and so labeling this decline as Minor A agrees that this degree label is larger than that one.
One also notes that the 18-day SMA is pointed downward and will likely act as resistance on the way up. With the embedded status, it is possible that Smart Money will continue to sell rallies until the embedded status is lost (and the %K red line of the daily slow stochastic crosses back up over the 21 level).
As we stated in the comments for the prior post, it is possible we completed the Minor A wave and are now into a messy B wave as a flat or combination. We'll see how tomorrow proceeds.
Have an excellent rest of the evening,
TraderJoe
We were expecting a messy wave downward. We're getting one. So far, in the ES futures, we may be getting a diagonal - as previously expressed. By far, the count that 1) is most proportional, 2) flows the best, and 3) does not involve degree violations is this expanding diagonal which a couple of us are counting. As well, this count follows the Elliott Wave Oscillator profile at the moment and can be clearly seen in the closing only chart below.
There are other ways to see the Minor A wave at today's low, but it does not quite look as proportional as this count. So, I'll hang on to that alternate for the time-being.
The above chart does provide a clean invalidation and it also suggests quite a wild snap-back from the current price lows. That is in agreement with today being the fourth consecutive close of price below the lower daily Bollinger Band, and the daily slow stochastic still in over-sold territory. And A waves can often be diagonals, particularly in corrections. So, we have to go with what looks best at present.
We'll keep you updated as best we can. The wave structures are very testy.
Have an excellent start to the evening,
TraderJoe
Just a word of caution for tomorrow. Today marked the third consecutive day of the ES futures closing below the lower daily Bollinger Band with the daily slow stochastic in over-sold territory as per the ES daily chart, below.
This means the odds of another close below the band is only about 2 - 5%. Some of the Smart Money is likely taking profits at the lower band. Yes, price could go down to fill the gap or hit the 100-day SMA. But, even as today showed (because of the profit-taking) whippy behavior could immediately follow. Price could certainly close back inside the band at any time.
From an Elliott-Wave perspective we are counting the Minor A wave down. We can see one way it could have completed, and another way for it to continue. See the comments from the prior post if you have the interest. So, we are patient until the length of price movement becomes more convincing.
Have an excellent start to the evening.
TraderJoe
