3:30 p.m. New York time

Half an hour before the closing bell. The S&P 500 rose during the day, reaching a peak of 4420.50 on the futures, 4429.97 on the index. Late in the day it reversed, falling slightly. All of this is happening within uptrending wave 3 of Minuscule degree within wave 1 of Submicro degree. That is, the late-day decline is a correction within an uptrend. No change in the analysis. I’ve updated the chart.

2:30 p.m. New York time

My trades. I’ve entered a short bull put spread position on SPY and a long call option on GM, and exited a long put on XLY.

9:35 a.m. New York time

What’s happening now? The S&P 500 E-mini futures continued climbing overnight, exceeding the high of October 1.

What does it mean? The break beyond the range of the correction than ran from October 1 to October 6 adds weight to a scenario that says the correction has ended and a rise is underway that will eventually exceed the September 3 high of 4549.50.

What’s the alternative? If the price reverses and falls back to the 4270s, then the alternative scenario comes into play: The present rise separates two corrective patterns in a compound structure.

What does Elliott wave theory say? Under my principle analysis, the rise that began yesterday is wave 3 of Minuscule degree within wave 1 of Submicro degree within 5th waves of successively higher degrees — Micro, Subminuette and Minuette — within wave 5 of Minute degree within wave 3 of Minor degree, which began on October 30, 2020.

The September 3 peak ended wave 3 of Micro degree, and wave 4 of Micro degree ended on October 1. The present wave 5 of MIcro degree will eventually reach to new heights, beyond the end of the preceding 3rd wave.

If the price reverses before reverses from its present level, plus or minus, then wave 4 of Micro degree is still underway and is forming a compound structure. Under this alternative scenario, the present wave is wave X of Submicro degree and will be followed by another corrective pattern, most likely a Zigzag or a Flat.

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, 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, October 7, 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.

Lot 3

iShares China Large-Cap ETF (FXI)

Update 11/11/2021: I exited my short bear call spread position on FXI eight days before expiration, for a $2.05 debit per contract/share, a loss before fees of $1.37 per contract. Shares were trading at $41.37, up $3.78 from the entry level.

The Implied Volatility Rank at exit was 39.1%, down 20.1 points from the entry level.

My decision to exit was based on a sudden reversal of the price to the upside as the expiration date approached, cutting my losses before they grew even larger.

Shares rose by 10.1% over 36 days for a +102% annual rate. The options position produced a 66.8% loss for a -678% annual rate.

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I have entered a short bear call spread on FXI, using options that trade for the last time 44 days hence, on November 19. The premium is a $0.68 credit per contract share and the stock at the time of entry was priced at $37.59.

The Implied Volatility Ratio stands at 59.2%

Premium:	$0.68	Expire OTM
FXI-bear call spread	Strike	Odds	Delta
Calls
Long	42.00	91.0%	11
Break-even	39.68	79.5%	23.5
Short	39.00	68.0%	36

The premium is 45.3% of the width of the positions short/long spread. The profit zone covers a 5.6% move to the upside.

The risk/reward ratio is 3.4:1, with maximum risk of $232 and maximum reward of $68 per contract.

How I chose the trade. FXI has moved below resistance, the low of October 4, in what I count as a 5th wave in the decline that began on September 7. I set the strike price just above the peak of the most recent upward move within the descent. My read of the chart is that FXI is in a downward movement that will take a few weeks to work through.

By Tim Bovee, Portland, Oregon, October 6, 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.

3:30 p.m. New York time

Half an hour before the closing bell. The S&P 500 reversed direction and resumed its climb while remaining below the two prior peaks since the low that ended wave 4 of Micro degree on October 1. No change in the analysis. I’ve updated the chart, labeling the overnight low as the end of wave 2 of Minuscule degree.

11:15 a.m. New York time

My trades. I’ve entered a bear call options spread on FXI. I’ve exited my position on PAAS for a loss.

9:35 a.m. New York time

What’s happening now? The S&P 500 E-mini futures declined sharply in overnight trading, remaining above 4260, the low of October 1 that ended the decline that began on September 3.

What does it mean? The decline is the third leg of a low-level correction within the rise that began on October 1.

What’s the alternative? If the price should move below 4260, then something else is going on, such as the decline that began September 3 not yet being complete.

What does Elliott wave theory say? By my principle analysis, the low of 4260 on October 1 ended wave 4 of Micro degree. The subsequent rise was wave 1 of Minuscule degree within wave 5 of Micro degree, the decline that followed is wave 2 of Minuscule degree. That 2nd wave correction has so far reached a low of 4267.50, on October 4, just 7-1/2 points above the end of wave 4 of Micro degree. A fall below the end of that 4th wave would suggest that the correction is still underway. On the chart I’ve marked wave 2 of Minuscule degree as still being underway. However, it’s possible that wave 2 ended at the October 4 low, and the second low in overnight trading wave 2 of Subminuscule degree within wave 3 of Minuscule degree. As always, the degrees are ambiguous — the market provides no “You Are Here” signs.

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, 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, October 6, 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.

Virgin Galactic Ltd. (SPCE)

I have entered a put on SPCE, using options that trade for the last time 108 days hence, on January 21, 2022. The premium is a $3.25 debit per contract share and the stock at the time of entry was priced at $22.30..

The Implied Volatility Ratio stands at 11.1%, and time decay is running at 0.0154.

Premium:	$3.35	Expire ITM%
SPCE-long option	Strike	Odds	Delta
Put
Long	22.00	57%	41

Maximum risk is $335 per contract and maximum reward is uncapped.

How I chose the trade. I entered the trade based on a down signal from the Fisher Transform indicator, confirmed by the price falling below resistance.

By Tim Bovee, Portland, Oregon, October 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.

Pan American Silver Corp. (PAAS)

Update 10/6/2021: The Fisher Transform indicator whipsawed on PAAS, giving a sell signal the day after a buy signal that triggered entry. I’ve exited the position for a $1.16 credit per contract/share, a loss of $0.35 from the entry price. The share price declined by $0.02, to $22.39.

The Implied Volatility Rate declined by 1.3 points to 18.9%.

Shares declined by 0.1% over one day for a -33% annual rate. The options position produced a 17.9% loss for a -6,518% annual rate.

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I have entered a put position on PAAS, using options that trade for the last time 108 days hence, on January 21, 2022. The premium is a $1.96 debit per contract share and the stock at the time of entry was priced at $22.41.

The Implied Volatility Ratio stands at 20.2%.

Premium:	$1.96	Expire OTM
PAAS-long option	Strike	Odds	Delta
Put
Long	22.00	43.0%	46.9

The maximum risk is $196 and the maximum reward is unlimited. Time decay at the time of purchase was $-0.01 per day.

I entered the position based on a short signal on the Fisher Transform indicator. I anticipate exiting upon receipt of a long signal on the Fisher, or by November 19, whichever comes first.

By Tim Bovee, Portland, Oregon, October 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.

3:30 p.m. New York time

Half an hour before the closing bell. The S&P 500 continued to rise during the day. No change in the analysis. I’ve updated the chart.

1:55 p.m. New York time

Today’s Trades. Long put positions on PAAS and SPCE.

Today is the optimal day for entering short spreads whose options expire on November 19. I couldn’t find anything I liked; the risk-reward ratios were simply way too high. I’ll keep looking. The window for entry will be open through October 12.

9:35 a.m. New York time

What’s happening now? The S&P 500 E-mini futures continued to rise in overnight trading, remaining above yesterday’s low of 4267.50.

What does it mean? The present rise is the third leg within a larger upward trend that began on October 1. It will continue to work its way higher, eventually exceeding the September 3 peak, 4549.50.

What’s the alternative? The rise could be a separator within a compound correction. One corrective pattern is complete, and the separator sets the stage for a second corrective pattern.

What does Elliott wave theory say? The rise that began yesterday from 4267.50 is the 3rd wave within wave 1 of Minuscule degree within the larger wave 1 of Submicro degree. This is all happening within a series of 5th waves, in order of increasing size, of MIcro, Subinuette, Minuette and Minute degrees, which in turn are subwaves of wave 3 of Minor degree, part of a Diagonal Triangle that began in December 2018, forming the 5th wave of Intermediate degree. Minor wave 3 will carry the price to new highs, above the prior peak of 4549.50, set on September 3. The subsequent Minor wave 4 will carry the price to to the lower boundary of the Triangle, which is presently below 2050 and continuing to move lower.

Under the alternative analysis, the present rise is part of wave X of Submicro degree, which separates two corrective patterns within a compound correction, wave 4 of Micro degree. The first corrective pattern, a Zigzag, ended on October 1, having lasted nearly a month. The second pattern, which will begin after wave X, might well last a similar amount of time. When it is done, then we can expect the rise to new highs described in the principle analysis.

The higher the price goes, the more likely the principle analysis is corrective. If the price reverses and falls bellow the October 1 low of 4260, then the alternate scenario becomes the most likely.

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, 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, October 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.

3:30 p.m. New York time

Half an hour before the closing bell. The S&P 500 fell during the trading session, on the futures to within eight points of Friday’s low, and then reversed. No change in the analysis. I’ve updated the chart.

9:35 a.m. New York time

What’s happening now? The S&P 500 declined in overnight trading to about 50 points below Friday’s high, reaching a low of 4315. From that low it rose slightly as the opening bell approached.

What does it mean? The decline appears to be a downward correction within the early portion of a rise that began October 1 and under my principle scenario eventually can be expected to exceed the September 3 high, 4549.50.

What’s the alternative? The rise could prove to be a shorter rise and fall separating two corrective patterns in a compound structure. Under this alternative scenario, the price will begin its rise to new highs, but later than is the case under the principle scenario.

What does Elliott wave theory say? Under my principle analysis the decline from October 1 is 2nd wave within wave 1 of Minuscule degree within wave 1 of Submicro degree within a series of 5th waves of increasing size, from Micro degree up to Minute degree. All of this is taking place within wave 3 of Minor degree. The completion of Minor wave 3 will be followed by a 4th wave that will carry the price down to the low 2000s or below, to the lower boundary of a Diagonal Triangle that began on December 26, 2018.

The alternative analysis is the same as the principle analysis, except that wave 1 of Minuscule degree, with all of its parent waves, will be delayed by a second corrective pattern. Under this scenario, the rise tat began October 1 is wave X of Submicro degree separating the first corrective pattern within wave 4 of Micro degree, which began on September 3, from a second corrective pattern which could well take a month or so to reach completion. At the end of that second pattern, the principle scenario described above will begin.

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, 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, October 4, 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.

3:30 p.m. New York time

Half an hour before the closing bell. The S&P 500 has continued to rise throughout the session, reaching 4360s on the futures, 4370s on the index, as the closing bell neared. The intensity of the rise gives credence to my principal analysis: That the correction ended overnight and wave 5 of Micro degree is on its way to new highs. I’ve updated the top chart, showing a near-term view.

9:35 a.m. New York time

What’s happening now? The S&P 500 E-mini futures dropped in 4260 in overnight trading and then executed a sharp reversal, moving up 60 points.

What does it mean? By my principal analysis, the correction that began on September 3 ended at the overnight low, and a rise has begun that will eventually exceed that date’s high, 4549.50. This analysis will be disproven if the price reverses and drops back to the 4260 region.

What’s the alternative? If the price rise falls well short of the September 3 high, then the correction is still underway and is taking a compound structure, in which two corrective patterns are connected by an intervening wave. Under this scenario, the rise that began last night is the beginning of that intervening wave.

Charts. The top chart is a near-term chart, tracking the correction that began September 3. The lower chart is a long-term chart, showing the Diagonal Triangle that began in December 2018.

What does Elliott wave theory say? Under the principal analysis, last night’s low marks the end of wave 5 of Micro degree and also of two parent waves of increasingly larger degrees, wave C of Submicro degree, and its parent wave 4 of Micro degree (the correction that began on September 3). The ensuing rise is wave 5 of Micro degree, which will push beyond the September 3 high of 4549.50, perhaps significantly so.

Under the alternative scenario, the rise that began last night is an X wave, connecting two Submicro corrective patterns within wave 4 of Micro degree. The first pattern, now complete, proved to be a Zigzag. The second pattern, after wave X is complete, could be another Zigzag, or a Flat, or perhaps a Triangle of some kind. There is a lot of variety in corrective waves. If the alternative scenario proves to be correct, then the present rise won’t approach the September 3 peak.

Under both scenarios, wave 4 of MIcro degree eventually ends, and the 5th wave that follows will carry the price up to new highs. The end of wave 5 of Micro degree will cascade up the degree ladder, also marking the end of 5th waves of Subminuette, Minuette and Minute degree. One more level up, and it’s the end of wave 3 of Minor degree, which began on February 23, 2020, at the end of the early pandemic crash. The ensuing wave 4 of Minor degree will carry the price down to the lower boundary of an Expanding Triangle that began. The boundary drops lower every day and is presently in the 1980s.

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, 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, October 1, 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.

Consumer Discretionary Select Sector SPDR Fund (XLY)

Update 10/7/2021: I’ve exited my long put position on XLY for a debit of $4.80, a loss of $1.95 per contract/share. Shares were trading at $180.78, down $3.22 from the entry level.

The Implied Volatility Rank at exit was 23.30, down 4.9 points from the entry level.

I exited based on a sell signal from the Fisher Transform indicator.

Shares declined by 1.98% over seven days for a -91% annual rate. The options position produced a 28.9% return for a -1,506% annual rate.

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I have entered a long put on XLY, using options that trade for the last time 78 days hence, on December 17. The premium is a $6.75 debit per contract share and the stock at the time of entry was priced at $180.78.

The Implied Volatility Ratio stands at 28.9%.

The position must be managed by October 15, which 63 days before the last trading day.

Premium:	$6.75	Expire OTM
XLY-long option	Strike	Odds	Delta
Put
Long	180.00	49.0%	46

I entered the position based on a buy signal from the Fisher Transform on a daily chart.

By Tim Bovee, Portland, Oregon, September 30, 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.

SPDR Gold Shares (GLD)

Update 10/13/2021: I exited my long call position on GLD 21 days before expiration, for a $5.31 credit per contract/share, a profit before fees of $116 per contract. Shares were trading at $167.55, up $3.16 from the entry level.

The Implied Volatility Rank at exit was 14.7%, down 13.2 points from the entry level.

My decision to exit was based on a sharp rise in the chart followed by a pause. In other words, anticipating a correction, I took the money and ran.

Shares rise by 1.9% over 13 days for a +54% annual rate. The options position produced a 28.0% return for a +785% annual rate.

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I have entered a long call on GLD, using options that trade for the last time 78 days hence, on December 17. The premium is a $4.15 debit per contract share and the stock at the time of entry was priced at $164.39.

The Implied Volatility Ratio stands at 28.9%.

The position must be managed by October 15, which 63 days before the last trading day.

Premium:	$4.15	Expire OTM
GLD-long option	Strike	Odds	Delta
Call
Long	165.00	54.0%	49

I entered the position based on a buy signal from the Fisher Transform on a daily chart.

By Tim Bovee, Portland, Oregon, September 30, 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.