3:30 p.m. New York time

Half an hour before the closing bell. The S&P 500 continued its upward push today, continuing to show the energy typical of a 3rd wave. The high so far today is 4073.75 on the futures, 230.5 points above the start of rise, wave 3 of Submicro degree. The index high so far is 4083.42. I’ve updated the chart below.

9:50 a.m. New York time

What’s happening now? The S&P 500 E-mini futures continued their rise in overnight trading, reaching 4048.25 after the opening bell.

What does it mean? The continuing rise is the middle wave within an uptrend that began March 4. When complete, the middle wave will be followed by a shallow correction, and then a push to higher highs.

What does Elliott wave theory say? The rise since March 25 is wave 3 of Submicro degree within wave 3 of Micro degree, which began on March 4. A 3rd wave within a 3rd wave has a great deal of power. Submicro 3 will be followed by Submicro 4, and 4th wave corrections tend to be a shallow, sideways correction, a Flat form in Elliott wave terminology. The preceding 2nd wave correction was directional, called a Zigzag form in Elliott wave analysis, and under the rules of Elliott waves 2 and 4 must have different forms.

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.

• Elliott wave analysis
• Fibonacci level

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, April 5, 2021

Disclaimer

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.

License

All content on Tim Bovee, Private Trader by Timothy K. Bovee is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.

Based on a work at www.timbovee.com.