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Friday, July 3, 2020

Weekend Charts and Stuff

Some random charts. We'll start with e-minis which of course has been trading overnight and today.  Three notable things perhaps.
1.) the 4 day uptrend line was broken just as was on the cash index on Thursday.
2.) E-minis made an eventual lower low than Thursday's afternoon lows on the cash index.
3.) It seems all indexes (SPX, DOW, NAS100) confirmed the lower lows just as they all confirmed them on Thursday in the afternoon. 

So all three have the same look (as of now). 3 lower lows from Thursday's peak which means they all are in current agreement. I show the e-mini S&P500.

Wave (c) of [ii] beat the price of wave (a) by a mere .25 points. That was all that was required for this to be a 5-3-5 zigzag.
Tesla. Tesla caught my eye because Elon Musk was dunking shorts on Twitter Thursday.
Zooming in closer. It counts well. And thrust up on Thursday out of a triangle. High of Day on first candle.  And Elon dunking on the Securities and Exchange Commission and shorts on Twitter likely made some enemies.  I mean the count and sentiment scream "top tick". Just who the heck bought this on Thursday during the day?
I'll just keep tacking on stuff here as the weekend goes on.


10 year treasury yield.
Seems a tringle is forming.
A slight variation on the count. Either way, both charts imply the same thing eventually.
30 year yield pretty much the same count.
Gold. It has enough waves in place to count complete however, it would seem an unfitting ending for having rallied so hard for 5 years.  I think it goes higher.
And a special treat for you gold bugs out there, I'll be charting the Gold every day using TOS charts.

We can see it clearly made 5 waves out of the (e) of [iv] triangle. Now we are looking for a pullback for (ii). $1754 is clear support.

UPDATED CHART. Thanks to reader Mike for pointing out I had (e) low labeled at the wrong spot (had it at (c) instead) on the TOS chart.  (That explains how I couldn't figure out why i and iv were overlapping by a point. Now they are properly labeled.)

It wouldn't take much price drop to break under the lower channel line.  Having 5 touches makes that line important. Note that Apple didn't confirm the Composite new all-time high on Thursday.
For those that want to see the best guess counts to new market highs, here they are for now.  I'll update if required and post if they break higher than where 3 is marked. They would become primary counts in that case.

There are 2 variations.  When it comes to 5 wave moves, I'm a big believer in channeling.  They have to connect in a way that suggests 1 and 3 and 2 and 4 connect on a channel and 5 falls somewhere in between. The problem here is 3 is such a distinct top (its an island - which is usually not seen at tops of a wave 3!) that when I moved the channel lines to accommodate the recent price break, I cut right under the island top.  There are lots of technical and sentiment reasons I think this won't happen, but we have to be prepared so here they are.

The first supposes the market has to continue sideways and shake our more sellers. Best guess is the old reliable [w]-[x]-[y] pattern with triangle in final position.  In effect, this is re-forming our wave 4 minor triangle.  You could label it either way in the end. That makes sense and we made a new lower channel line to accommodate. This option gives the market more time overall.
A more detailed look. 
The other pattern is that the market has already spun up the energy of [i]-[ii], and now working on (i)-(ii). This implies "upside surprise" or iii of (iii) of [iii] is not too far away, likely next week.   

At least we'll get to see Portney picking stocks by throwing darts, blindfolded, at a dartboard with the NASDAQ 100 stocks on a piece of paper. 



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