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Friday, May 1, 2009

The Bullish Intraday Squiggle Play

The market has the potential to get bullish by end of today and then followthru on Monday with the way I labeled this chart.

Or it might be triangulating in a consolidation pattern and will move lower, which of course implies a B wave of some sort .
The key to the count is today's low so far. So you could buy some longs and set your stop loss at today's 866.1 low if your feeling froggy long. Its just one example of an intraday chart pattern and how it fits into a larger pattern that you might use to daytrade.

I'm not trading today and set a stop loss on my QID. Don't feel like holding thru weekend if the market finishes in a bullish manner today.


  1. Yes Shanky. P2 was supposed to be heh

  2. nice work, I like it but that ending diagonal is rare for a-b-c patterns. how about a leading diagonal into the 3rd wave down? I'm not sure I see the 5-3-5-3-5 for that possibility though.

  3. well maybe I can see 5-3-5-3-5. In any case if this bullish pattern is correct we should explode up today.

  4. Daneric,

    I truly respect your creative thinking and imagining of alternative scenarios, but I don't see this super-bullish scenario today.

    Today the S&P fell 6 points, then rose 10 points (to be up a mere 4 points), then fell 4 points (to be even with yesterday's close. At mid-day, it seems like a pretty tame market, with very low volume. I just don't see a super-bullish run to 900 by Monday. Please explain what the catalyst for this is likely to be today or Monday.

  5. You slimeball you just squeezed me outta my faz i added today.....baastid.......hehehe...made money...neva complain....still holdin core faz...

  6. Hey Kli,

    Instead of holding a core postion in FAZ I would suggest you hold a core short position in FAS. That way the decay works in your favor.


  7. SRS, I'm not saying the superbullishness has to be today. But if it maintains support today (above the breakout trendline) and trading ends on a positive note, Monday could be a gap up.


    Its P2!

  8. Daneric,

    Thanks for your quick reply. But I'm confused:

    Just last night your post was titled "The Market is going down." And you said you were making a "commitment".

    Are you really changing your prediction based on today's "bullish intraday squiggles"? Or is this just a less-likely alternate scenario?

  9. Deneric is sending mixed signals. This is usually a good sign to get out of the market.

    But I'm a sucker for reality and holding FAZ for now.

  10. Yes I committed last night and the market is proving me wrong at the moment. I was thinking it would be down 1-2% by now or at least broken trendline support. A potential valid ABC correction down to 866 has traced out. What can I do? I don't control the tape.

    I must also respect EWI's primary count which is bullish.

    So yeah my committment only can last as long as the tape suggests it should last.

    I thought today would be down nicely I said as much last night. Maybe its too early, but it sure ain't playing that way. I only need a half day to change my mind because the tape is telling a different story (so far).

    It may indeed drop hard Monday, but its not giving any kind of sign at the moment that that will happen.

    I'm sure the MM's are yanking my chain, yet I must respect the P2 wave and the potential for upside surprise.

    It just doesn't look like consolidation for a move down. Just the opposite. It looks like consolidation for a move up further.

    1 day's waves can do that yes....

    But MM's might just rip it hard down at end of day...either way, my QID is stop lossed at a 70% retrace back up from today's low to 888 high. That is more than reasonable.

    It looks ABCish so may be its a big B wave triangle. Regardless I expected some kind of 5 wave sell pattern by now to devlop and it hasn't happened.

    I'm just trying not to fight the tape. I learned that lesson long ago.

  11. Anyone here knows why metal and coal up so huge today? Can't find any news about them. Thanks.

  12. The stocks of several American coal companies are surging after Ukraine's Metinvest said it had acquired United Coal, according to Reuters.

  13. Daneric,

    Thank you for your thorough and thoughtful reply.

    Just so you know, I wasn't criticizing you. I was just confused by the rapid change-of-view (which you have now explained).

    You know, Dan, I think people new to EWT (like myself) have the initial impression (and the hope) that EWT projections are actually predictions. (Remember that recent "Anonymous" comment that was really angry and called you a name, and I defended you?)

    So, I think it might be good for both you and your readers if you expand on your disclaimer that "my charts have been known to steer in the wrong direction from time to time" -- and make it so prominent that everyone is sure to read it and "get it."

    Maybe something like this:

    "ALL EWT chartists (myself included) try their best to determine how the market is unfolding. Alternate counts can indicate very different directions. Furthermore, a change in the way the waves are unfolding can -- and often does -- force a rapid change in the count and the projection of the market's direction and targets. EWT deals in probabilities that can change, not certainties that are permanent. So trading always involves risk of loss from being wrong."

    I know that you, Kenny, and EWI are doing your best. And I appreciate your efforts even when you change your projections -- and even when they turn out to be wrong. People just need to have a proper understanding and expectation of what EWT's strengths and limitations are. That will reduce confusion, frustration, and misunderstandings between everyone.

    All the best to you.

  14. waves just crossed on the dow... hmmm...

  15. Dano...watta ya think of my .382 off of 833 that would be 770 about which puts us at 766 gap i fos......but I see 833 as last impulse labeled it a little different.

  16. Thanks SRS. Yes, many come looking for the quick answer for a daytrade. EW's are just one tool for trading. Longer term, they are a much better determiner of market direction tahn anything I know.

    I actually use straight up TA when trying to predict a top not just EW. Market is extended no doubt but that doesn;t guarantee a move down until its ready.

    Well put. EW just increases your probabilities just like regular TA patterns.

    I also use a lot of trendlines and support zones and when they obey or hold support, you must respect it.

    888 could very well be the top. Just that my shorts are not behaving as I'd hoped just yet and I don't like fighting the tape. Thats all.

    And the wave structure suggests something else may be happening. No impulsing down (yet) today and I very much expected it by now.

    1.5 hours left and then there is Monday.

    My QID hasn;t stopped out so all is good for now.

  17. Daneric when do you see this wave 3 coming into play...this year or next?
    Also Charles Nenner who incorrecly predicted this rally (dates were a bit off) says we will hit a new lower this summer. I'm wondering if you see that as well.

  18. looks like this pattern will happen. I can't see a bearish turnaround, especially after the fun we had just before close bouncing off of the trend line. after all, EWI are not idiots. I should have covered.