CURRENT CHARTS


Click HERE to view current charts

Monday, February 13, 2012

Monday, 2/13/12 update

The ES/SPX appears to be in a 5th wave of the rally off the lows of late Jan, and that move is itself a 5th wave of either Intermediate or Minor degree ( more on that in a bit). Buying pressure as measured by the Vindicator Buy/Sell has been visibly waning with a series of lower peaks since late January (buying pressure is represented by the green line in the chart) which supports the idea that a 5th wave has been in progress:


In fact, 5 waves can be counted in the move up off of Friday's lows, so it's entirely possible that a top of some significance was established at today's highs, but if so that will need confirmation which isn't yet evident.

Whether the ES/SPX is going to put in a Intermediate or Minor degree top is also an open question. The two pertinent alternate counts are as follows:

Intermediate degree

Minor degree

The Minor degree alternate seems more likely, the move up since the Dec 19 lows looks like a unit to me. Also, in the Intermediate degree alternate Minor Wave 4 did much less damage (34 vs 73 points) and was much quicker (3 days vs 8 days) than Minor W2. The difference is significant - if the ES/SPX is on the verge of a correction of Minor degree it will be much more shallow and short lived than an Intermediate degree sell off.

5 comments:

  1. While anything is possible, there is no divergence in breadth indicators ( measured in cummulative mode) that typically preceded major correction.  That lends credence to the Minor degree alternate.   We shall see. lol

    ReplyDelete
  2.  Thanks Ken - confirms my guesstimation.

    ReplyDelete
  3. Hi Apple Al,

    I thought I would mosey on over to your site so that I can get another lesson in humility. I know virtually nothing on EW but it calls to me, so here I am

    First, what is ES? E-mini SnP? Futures? Thanks.

    2nd,  EW is way more complicated than I thought. I do not want to try and catch every single move. Just the big ones.

    I think I understand the following:

    Major wave: Currently wave 3.
    Within wave 3 we are most likely in wave 5 (wave 5 of 3)

    Does Latest wave count starts at October low or November low? It looks like your chart shows wave 1 started at end of November. OK. I can accept that because from October low, there is the decline in December which could not be wave 4 since wave 3 would then have become the shortest wave.

    Now, how do you know if wave 3 has ended and wave 4 has started? From the charts, you feel that we will go higher in wave 3 before beginning wave 4

    How do you know this?

    One last thing (it is a big thing):

    What do you mean with statement below:

    Also, in the Intermediate degree alternate Minor Wave 4 did much less
    damage (34 vs 73 points) and was much quicker (3 days vs 8 days) than
    Minor W2. The difference is significant - if the ES/SPX is on the
    verge of a correction of Minor degree it will be much more shallow and
    short lived than an Intermediate degree
    sell off.


    Minor wave 4 (01/26 to 01/30, 33 pts)
    Minor Wave 2 (12/07 to 12/19, 65 pts)


    Please be patient with me. I do learn extremely fast as long as I have time to study

    Conclusion: SPX should go to 1368 in wave 3 before beginning wave 4. Can you predict where wave 4 will end?

    Thanks,
    Aaron

    P.S. If history is any guide than we should see a correction of ~5-7% during wave 4 before seeing wave 5 begin. Does wave 5 by rule have to exceed the wave 3 high?

    Also, could you look into labeling the x and y axis on your chart?








     

    ReplyDelete
  4.  Stemski-
    Have read any books or material describing Elliott Wave theory in full? If not, you really should if you want to gain an understanding.
    To your questions:
    The ES is the mini S&P.
    Concerning your question about current wave count, there is no quick answer.  I am currently charting three possible alternates.  If you scroll to the top of this page you'll see a heading "CURRENT CHARTS", click on the word "HERE" under that heading and you will be routed to a new page.  If you look down the left sidebar on that page you'll see a bunch of chart icons, clicking on one of those icons will bring that chart up.  The current Elliott count alternates start at the third chart down, there is an hourly and daily chart for each one.

    How do you know when Wave 3 has ended and Wave 4 has started?  That, my man, is the type of question that separates the winners from the losers.  The only way to know for absolute sure is in hindsight.  I use a variety of techniques to judge the market's position and probabilities at any given time, none of them is 100%, so it's a matter of experience and judgement, and even with plenty of that there are missteps.

    The discussion about the late Jan correction being a Minor Wave 4 is alluding to the strength and duration of that correction as compared to that of the early Dec sell off.  If those two moves were of the same degree you would expect them to be of approximately equal severity and length, but the Jan decline is noticeably less severe than the one in Dec, so the argument is that the Jan decline is more likely a correction of one less degree than the one in Dec.  So therefor Minor Wave 3 was still in progress with a Minor Wave 4 & 5 yet to come before a much more severe sell off of Intermediate degree occurs.

    As far as predicting the end of waves, you can only make guesstimates, see my comment earlier about separating winners from losers.

    Concerning Elliott rules for 5th waves, no it does not have to exceed the high (or low) of the prior 3rd wave, but it should get close.  If a 5th wave doesn't exceed the travel of the prior 3rd it is called a "5th wave failure".

    Finally, the x and y axes are labeled, dates are across the bottom of the charts and price markers down the right side, so I'm not sure why you ask.  Possibly you don't know how to enlarge them?  

    ReplyDelete
  5.  Stemski-
    sorry accidentally clicked before finishing comment - to enlarge a chart in a post right click on top of it, you'll get a drop down menu, select "Open window in new tab" then go to that tab, you'll be able to view an enlarged version.

    ReplyDelete