Tuesday, March 16, 2021

3:30 p.m. New York time

Half an hour before the closing bell. The S&P 500 rose to a high of 3970.75 on the futures, 3981.04 on the index, and then dropped off slightly as the price formed the internal structure of wave 5 of Subminuscule degree, which began yesterday. The end of Subminuscule 5 will mark the end of Minuscule 3, which will be followed by a shallow correction. I’ve updated the chart below.

9:40 a.m. New York time

What’s happening now? The S&P 500 E-mini futures reached 3966 in the uptrend that began March 10 from 3856.25.

What does it mean? Internally, the uptrend is in its final wave, which will be followed by a shallow correction. There’s no guidance on how far a final wave in a trend can go, so there’s no way of setting an upper price target.

I have no alternative analysis today.

[S&P 500 E-mini futures at 3:31 p.m., 25-minute bars, with volume]

What does Elliott wave theory say? The present rise is wave 5 of Subminuscule degree. Its completion will also mark the end of wave 3 of Minuscule degree, which began on March 10 from 3856.25. All of this is happening within wave 3 of Submicro degree, and up the ladder, wave 3 of Micro degree, wave 5 of Subminuette degree and wave 5 of Minuette degree. So at this point we’re tracking quite small degrees, where movements are a matter of days, not weeks, and certainly not the years and decades seen on a longer-term chart.

Learning and other resources. Elliott Wave International has long been the leading analytical house based on Elliott wave theory. They make available a number of free educational materials and other resources, in addition to their for-pay subscriptions.

I recommend two books, both by people associated with EWI.

First, Elliott Wave Principle by Robert Prechter and A.J. Frost is the book that, along with Prechter’s analyses, that created the revival of Elliott wave theory. I first read it in 1984, and it has had a profound influenced on my thinking about markets ever since.

Second, I’ve found Visual Guide to Elliott Wave Trading by Wayne Gorman and Jeffrey Kennedy, both of EWI, to be a useful book that relates Elliott wave theory to practical trading. The authors are hands-on Elliotticians, and for an active trader, that’s exactly what’s needed — less theory and more how-to. The first chapter of the book gives a very nice thumbnail run down of what Elliott wave theory is all about.

Terminology. Here are some links to information about some of the technical jargon I use.

Charts. On my charts, waves have a subscript showing the degree above or below the Intermediate degree. Here are the subscripts and the degree each represents:

  • {+3} Supercycle
  • {+2} Cycle
  • {+1} Primary
  • No subscript: Intermediate
  • {-1} Minor
  • {-2} Minute
  • {-3} Minuette
  • {-4} Subminuette
  • {-5} Micro
  • {-6} Submicro
  • {-7} Minuscule
  • {-8} Subminuscule
  • {-9} Bitsy
  • {-10} Subbitsy

By Tim Bovee, Portland, Oregon, March 16, 2021


Tim Bovee, Private Trader tracks the analysis and trades of a private trader for his own accounts. Nothing in this blog constitutes a recommendation to buy or sell stocks, options or any other financial instrument. The only purpose of this blog is to provide education and entertainment.

No trader is ever 100 percent successful in his or her trades. Trading in the stock and option markets is risky and uncertain. Each trader must make trading decisions for his or her own account, and take responsibility for the consequences.

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