Trader’s Notebook

3:30 p.m. New York time

Half an hour before the closing bell. The S&P 500 continued to rise during the day, so far reaching 4393.25. The principal analysis from this morning — wave 4{-8) has ended — has been replaced by the alternative analysis — wave 4{-8} is continuing — and the chart reflects that change.

Wave 4{-8} can end at any turning point, including the most recent high. It has fulfilled its minimum requirements under the Elliott wave model.

The new high for wave 4{-8} also raises the lowest end point for the futures wave 5{-8}, for reasons explained in this morning’s Elliott wave analysis section. The new maximum end point is 4196. I’ve updated the chart.

1:15 p.m. New York time

FDX earnings play entry. I’ve entered a short bull put options spread on FDX timed to coincide with the company’s earnings announcement after the closing bell and have posted an analysis of the trade.

9:35 a.m. New York time

What’s happening now? The S&P 500 E-mini futures fell back slightly from yesterday’s peak, 4367.50.

What does it mean? The peak may be the end of the upward correction that began on March 15 and the beginning of a resumption of the downtrend that began on March 3.

lWhat’s the alternative? But it’s just as likely that the final leg of the correction will rise further and that the downtrend has not yet resumed.

[S&P 500 E-mini futures at 3:30 p.m., 30-minute bars, with volume]

What does Elliott wave theory say? The present rise is wave C{-9}, the final wave in an upward correction, wave 4{-8}. The end of 4{-8} marks the beginning of downtrending wave 5{-8}.

As discussed in the afternoon revision in yesterday’s post, wave 5{-8} has limited downward potential. Wave 3 is shorter than wave 1. Under the rules of Elliott wave analysis, wave 3 can’t be shorter than both waves 1 and 5. So wave 5{-8} can’t be longer than wave 3{-8}, which was 197.25 points long.

The new higher starting point for wave 5{-9} means that its ending point can’t be lower than 4170.25, marked with a red line on the chart.

I’ve marked the chart as though wave C{-9} were complete — the principal analysis — but I consider both the principal and the alternative analyses to have equal likelihood. There may be revisions ahead during the trading session.

We Are Here.

These are the waves currently in progress under my principal analysis. Each line on the list shows the wave number, with the subscript in curly brackets, the traditional degree name, the starting date, the starting price of the S&P 500 E-mini futures, and the direction of the wave.

  • Index:
  • 5{0} Intermediate, 12/26/2018, 2346.58 (up)
  • 4{-1} Minor, 1/4/2022 4818.62 (down)
  • 1{-2} Minute, 1/4/2022 4818.62 (down)
  • Futures and index:
  • 1{-3} Minuette, 1/4/2022, 4808.25 (down) (futures), 4818.62 (down) (index)
  • Futures:
  • 1{-4} Subminuette, 1/4/2022, 4808.25 (down)
  • 1{-5} Micro, 1/4/2022, 4808.25 (down)
  • 1{-6} Submicro, 1/4/2022, 4808.25 (down)
  • 5{-7} Minuscule, 3/3/2022, 4101.75 (down)
  • 5{-8} Subminuscule, 3/16/2022, 4367.50 (down)

Learning and other resources. Elliott wave analysis provides context, not prophecy. As the 20th century semanticist Alfred Korzybski put it in his book Science and Sanity (1933), “The map is not the territory … The only usefulness of a map depends on similarity of structure between the empirical world and the map.” And I would add, in the ever-changing markets, we can judge that similarity of structure only after the fact.

See the menu page Analytical Methods for a rundown on where to go for information on Elliott wave analysis.

By Tim Bovee, Portland, Oregon, March 17, 2022


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.

Creative Commons 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