3:30 p.m. New York time

Half an hour before the losing bell. The S&P 500 futures traded between the 5990s and the 6030s during the session.

Elliott Wave Theory analysis: Unchanged. The 4th wave downward correction that began on November 4 continues and is now in it middle subwave, wave B.

9:35 a.m. New York time

What’s happening now? The S&P 500 E-mini futures traded sideways most of overnight, until the Consumer Price Index data for October was released, sending the futures rising from just above 6000 into the 6030s within a span of 10 minutes. The index rose by 0.2%, the same as in the prior two months.

What does it mean? Elliott Wave Theory sees the rise as the middle wave — wave B — within the 4th-wave downward correction that began on October 11. Wave 4 is a subwave of a 5th-wave uptrend that began on November 4.

Each wave on the chart are labelled with its wave number and a subscript in curly brackets show the waves position in the fractal structure of the price movements relative to the Intermediate Degree, which began in December 2018.

As seen on the chart, the rise overnight was rising wave B{-12} within a falling corrective movement, wave 4{-10}.

The subwaves within wave 4{-10} were ambiguous at the outset but became somewhat clearer during the November 12 session as analyzed the afternoon’s Trader’s Notebook. I had analyzed the decline as wave C. Wave B now seems more likely, and it could be that the waves labeled A{-12} and B{-12} on today’s chart will turn out to be waves 1{-13} and 2{-13}, subwaves of wave A{-12}.

So, clarity, yes, but it’s not yet perfectly clear.

[S&P 500 E-mini futures at 3:30 p.m., 90-minute bars, with volume]

What are the alternatives? No ambiguities beyond the subwaves within the 4th-wave downward correction that began on November 11.

What does Elliott wave theory say? Here are the waves that underly the analyses.

Principal Analysis:

• .Rising wave 5{0} is underway. It is a wave of Intermediate degree that began in December 2018.
• It is in its final subwave, wave 5{-1}.
• Within wave 5{-1}, rising waves 5{-2}, 5{-3} and 5{-4} are underway, as is wave 5{-5}.
• Wave 5{-5} is in its initial subwave, wave 1{-6}, which in turn is in its middle subwave, wave 3{-7}.
• Wave 3{-7} is in its final; subwave, uptrending wave 5{-8}.
• Wave 5{-8} is in its final subwave, wave 5{-9}, which is in its final subwave, uptrending wave 5{-10}.
• Wave 5{-10} is in wave 4{-11}, its next-to-the-last wave, which in turn is in wave B{-12}, its 2nd subwave.

Long-term Waves.

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.

• S&P 500 Index:
• 5{+3} Supercycle, 7/8/1932, 4.40 (up)
• 5{+2} Cycle, 12/9/1974, 60.96 (up)
• 5{+1} Primary, 3/6/2009, 666.79 (up)
• 5{0} Intermediate, 12/26/2018, 2346.58 (up)
• S&P 500 Futures
• 5{-1} Minor, 10/27/2023, 4127.25 (up)
• 3{-2} Minute, 10/27/23, 4127.75 (up)
• 3{-3} Minuette, 10/27/23, 4127.75 (up)
• 5{-4} Subminuette, 4/18/2024, 4963.50 (up)
• 5{-5} Micro, 8/5/2024, 5120 (up)
• 1{-6} Submicro, 8/5/2024, 5120 (up)
• 3{-7} Minuscule, 8/7/2024, 5182 (up)
• 5{-8} (unnamed), 9/6/2024, 5394 (up)
• 5{-9} (unnamed), 10/2/2024, 5724 (up)
• 5{-10} (unnamed), 11/4/2024, 5824.25 (up)
• 4{-11} (unnamed), 11/11/2024, 6053.25 (down)

Reading the chart. Price movements — waves – – in Elliott wave analysis are labeled with numbers within trending waves and letters with corrective waves. The subscripts — numbers in curly brackets — designate the wave’s degree, which, in Elliott wave analysis, means the relative position of a wave within the larger and smaller structures that make up the chart. R.N. Elliott, who in the 1930s developed the form of analysis that bears his name, viewed the chart as a complex structure of smaller waves nested within larger waves, which in turn are nested within still larger waves. In mathematics it’s called a fractal structure, where at every scale the pattern is similar to the others.

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, November 13, 2024

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.