3:30 p.m. New York time

Half an hour before the closing bell. The S&P 500 futures rose durng the session, reaching into the 5500s. Elliott Wave Theory: The uptrending 5th-wave that began on June 14 continues and is in its 3rd of five subwaves. It’s 5th-wave of low degree, the sort of wave that’s here today and often gone within a week. However, it has large implications for the market’s journey through the next few months. See this morning’s discussion below.

I’ve updated the chart.

9:35 a.m. New York time

What’s happening now? The S&P 500 E-mini futures gapped up by more than 60 points as trading resumed overnight, reaching above 5500.

What does it mean? Elliott Wave Theory: The rise is the 5th and final subwave within a larger 5th wave that began on June 11, all part of a still larger 5th wave that began on May 31. And there is a still larger 5th wave encompassing the smaller ones, a wave that began on April 18.

The parade of the 5th waves. A 5th wave holds a special place in the fractal structure that underlies price movements in markets and that informs Elliott Wave Theory’s analysis. A 5th wave is an ending. When a 5th wave ends, the wave one degree larger also ends. And if that wave is a 5th wave, so does the next next higher wave.

On this chart we have a line-up of four uptrending 5th waves that we’re tracking. When the smallest, the 5th wave that began on April 18, reaches its end, it will also be the end of the increasingly larger 5th waves up to the one that began on April 18.

The next larger wave in the hierarchy is an uptrending 3rd wave that began on February 21 from 4959.

When the smallest of the 5th waves reaches its end, that event will cascade across the structure, putting the large 3rd wave to an end and beginning a 4th-wave downward correction that will retracement a portion — perhaps a large portion, perhaps not so large — of the 500-plus points of that uptrend.

How big is the smallest 5th wave? As I’ve noted before, 5th waves are quirky. Sometimes they extend for a barely imaginable distance. Sometimes they truncate, failing to move past the end of the preceding 4th wave.

What are the alternatives? I’ve listed an ongoing ambiguity in previous posts. I’m dropping it for now pending further analysis of the new line-up.

[S&P 500 E-mini futures at 3:30 p.m., 115-minute bars, with volume]

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 3{-2}, 3{-3} and 3{-4} are underway, as is wave 5{-5}.
• Wave 5{-6} is underway and is in its final subwave, uptrending wave 5{-7}, which is in wave 5{-8}, also an uptrend.

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, June 17, 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.

3:30 p.m. New York time

Half an hour before the closing bell. The S&P 500 futures have risen during the session, returning to the 5430s. Elliott Wave Theory: The 4th-wave downward correction that began on June 11 continues. See this morning’s post for details.

I’ve updated the chart.

9:35 a.m. New York time

What’s happening now? The S&P 500 E-mini futures fell overnight, from the 5440s to the 5390s.

What does it mean? The Elliott Wave Theory analysis sees the 4th-wave downward correction continuing within the 5th-wave uptrend that began on June 11. The correction is nearing its end.

When the correction is complete, the final wave within the 5th-wave uptrend will begin, likely carrying the price to new heights. The uptrend, when complete, will resonate through the fractal structure of the chart, signaling the end of two 5th waves of increasingly larger degree and of a 3rd wave an additional degree higher. A larger 4th-wave downward correction will then begin.

What are the alternatives? It’s possible that the larger 5th subwave is actually a degree smaller, as are all of its subwaves, and that they are part of a 1st wave with a still larger 5th wave.

[S&P 500 E-mini futures at 3:30 p.m., 115-minute bars, with volume]

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 3{-2}, 3{-3} and 3{-4} are underway, as is wave 5{-5}.
• Wave 5{-6} is underway and is in its final subwave, uptrending wave 5{-7}, which is in wave 4{-8}, a downtrending correction that is in its final subwave, wave C{-9}.

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, June 14, 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.

3:30 p.m. New York time

Half an hour before the closing bell.The S&P 500 futures worked their way lower during the session, coming close to 5400 before retracing a portion of the decline. Elliott Wave Theory: It’s all part of a small downward correction within the larger uptrending 5th wave that began on June 11. See this morning’s analysis for details.

I’ve updated the chart.

9:35 a.m. New York time

What’s happening now? The S&P 500 E-mini futures reached a low overnight in the 5420s and then rose sharply into the 5450s and retreated as the opening bell approached.

What does it mean? Elliott Wave Theory sees the overnight movement as part of a small uptrending 5th wave that began on June 11. Internally, that 5th wave is working through its middle subwave, wave 3.

Completion of the 5th wave will trigger the end of two other 5th waves of increasing size, and encompassing them all, 3rd wave that began on February 21. A 4th wave downward correction will follow.

A 4th wave typically typically ends within the range of the 4th subwave within the preceding 3rd wave, which in this case ran from the 5330s to the 4960s. The 3rd wave has lasted for four months, and the 4th wave downward correction will have a roughly consistent magnitude — likely lasting months, not weeks.

The target range and consistent magnitude are tendencies, not rules. There are many exceptions

What are the alternatives? It’s possible that the larger 5th subwave is actually a degree smaller, as are all of its subwaves, and that they are part of a 1st wave with a still larger 5th wave.

[S&P 500 E-mini futures at 3:30 p.m., 110-minute bars, with volume]

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 3{-2}, 3{-3} and 3{-4} are underway, as is wave 5{-5}.
• Wave 5{-6} is underway and is in its final subwave, uptrendng wave 5{-7}.

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, June 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.

3:30 p.m. New York time

Half an hour before the closing bell. The S&P 500 futures dropped slightly during the session, barely budging when the Federal Open Market Committee announced it was holding interest rates steady.

Applying Elliott Wave Theory: The decline is a downward correction of low degree within the uptrending 5th wave that began on June 11.

I’ve updated the chart.

9:35 a.m. New York time

What’s happening now? The S&P 500 E-mini futures rose sharply as the opening bell approached after new inflation data showed no change in prices overall in May compared to the prior month. The Federal Open Market Committee will announce its decision on interest rates during the session, at 2 p.m. New York time.

What does it mean? In Elliott Wave Theory, the rise confirms that the small 4th-wave downward correction that began on June 7 ended on July 11 at 5334.50 and a 5th-wave uptrend, also of a low degree, began on that date.

Fifth waves are the wayward children within a trend. Sometimes they continue to rise far beyond the end of the preceding 3rd wave. Sometimes they come up short and never reach a price equal to or above that end point. They’re essentially unpredictable.

Internally, the present 5th wave will have five subwaves. The power of the overnight rise suggests that the uptrending 5th is in its 3rd of five subwaves.

Looking further ahead. From this point I’ll be referring to wave labels as they appear on the chart. The subscript in curly brackets shows the waves distance, within the fractal structure of the chart, from Intermediate degree. The latest Intermediate wave is 5{0}, which began in December 2018.

When the present 5th wave, labeled wave 5{-7} on the chart, reaches its end, it will be the end of trends stretching two degrees higher within the fractal structure of the chart: Waves 5{-6} and 5{-5}. It will also mark the end of the 3rd wave one degree higher that began on February 21, wave 3{-4}, and the beginning of a 4th-wave downward correction, wave 4{-4}, considerably larger than the small wave 4{-7} wave that ended on June 11.

What are the alternatives? It’s possible that the larger 5th subwave is actually a degree smaller, as are all of its subwaves, and that they are part of a 1st wave with a still larger 5th wave. On the chart, the larger 5th wave changes from 5{-6} to 5[-7}, wave 1{-6} is inserted into the line-up, They’re all subwaves if wave 5{-5}.

[S&P 500 E-mini futures at 3:30 p.m., 110-minute bars, with volume]

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 3{-2}, 3{-3} and 3{-4} are underway, as is wave 5{-5}.
• Wave 5{-6} is underway and is in its final subwave, uptrendng wave 5{-7}.

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, June 12, 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.

3:30 p.m. New York time

Half an hour before the closing bell. The S&P 500 futures rose during the session into the 5380s, remaining below the June 7 high of 5385.50. A rise above that level would suggest that the 4th-wave downward correction that began that high has ended, and that a 5th-wave uptrend has begun.

I’ve updated the chart.

9:35 a.m. New York time

What’s happening now? The S&P 500 E-mini futures drifted lower overnight, from the 5370s to the 5350s.

What does it mean? Elliott Wave Theory sees the decline as a small step within a 4th-wave downward correction that is a subwave of a 5th-wave uptrend that began on May 31. The 4th wave, which began on June 7, will have three subwaves and appears to be in the final subwave, declining wave C, although its possible that that the decline is a pullback within the preceding wave B, which is a rising wave.

It is the 5th-wave uptrend mentioned above that is the main driver of the chart. The 4th-wave downtrend, when complete, will be followed by a final wave that will complete the larger 5th-wave uptrend, and its parent wave, a larger 5th-wave uptrend that began on April 18. One degree high, and the end of the 5th waves will also be the end of a 3rd wave that began on February 21 and the beginning of a significant 4th-wave downward correction.

What is the alternatives? Its possible that the larger 5th subwave is actually a degree smaller, as are all of its subwaves, and that they are part of a 1st wave with a still larger 5th wave. On the chart, the larger 5th wave changes from 5{-6} to 5[-7}, wave 1{-6} is inserted into the line-up, They’re all subwaves if wave 5{-5}.

[S&P 500 E-mini futures at 3:30 p.m., 100-minute bars, with volume]

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 3{-2}, 3{-3} and 3{-4} are underway, as is wave 5{-5}.
• Wave 5{-6} is underway and is in its next-to-the-last subwave, corrective wave 4{-7}.

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, June 11, 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.

3:30 p.m. New York time

Half an hour before the closing bell. The S&P 500 futures rose into the 5370s during the session, remaining slightly below the overnight high — 5385.50 — as the closing bell approached. The small 4th-wave correction within the uptrending 5th wave that began on May 31 continues.

I’ve updated the chart.

9:35 a.m. New York time

What’s happening now? The S&P 500 E-mini futures declined slightly after trading resumed overnight, from the 5360s to the 5330s.

What does it mean? Applying Elliott Wave Theory to the chart, I’ve interpreted the June 6 peak, 5385.50, as being the end of the rising 3rd of five subwaves of an uptrending 5th wave that began on May 31. The 4th subwave, a small downward correction, is now underway. The waves are labeled on the chart: Wave 3{-7} ended, within wave 5{-6}. Wave 4{-7} underway.

When the 4th subwave is complete, it will be followed by a rising 5th subwave that will complete the larger 5th subwave that encompasses everything since May 31. A 4th-wave downward correction will follow.

What are the alternatives?

Alternative #1: Under the principal analysis, the 5th subwave within the 3rd subwave that just ended is unusually sort. It’s possible that the rise is a subwave within the 4th subwave, which is still underway.

Alternative #2: Also, its possible that the larger 5th subwave is actually a degree smaller, as are all of its subwaves, and that they are part of a 1st wave with a still larger 5th wave. On the chart, the larger 5th wave changes from 5{-6} to 5[-7}, wave 1{-6} is inserted into the line-up, They’re all subwaves if wave 5{-5}.

[S&P 500 E-mini futures at 3:30 p.m., 100-minute bars, with volume]

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 3{-2}, 3{-3} and 3{-4} are underway, as is wave 5{-5}.
• Wave 5{-6} is underway and is in its next-to-the-last subwave, corrective wave 4{-7}.

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, June 10, 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.

3:30 p.m. New York time

Half an hour before the closing bell. The S&P 500 futures fell to 5329 during the session and then rose to 5385.50, exceeding the overnight high. The higher triggered Alternative #1: The rising 3rd subwave within the larger 5th-wave uptrend that began on May 31 is underway, replacing this morning’s principal analysis that saw the 3rd subwave having ended and the 4th subwave having begun.

I’ve updated the lower chart, showing the larger 5th-wave uptrend it in its entirety, so far.

9:35 a.m. New York time

What’s happening now? The S&P 500 E-mini futures quickly rose to 5380 when the latest employment/unemployment data was published, and hour before the opening bell, and swiftly fell back into the 5330s.

[S&P 500 E-mini futures at 8:35 a.m., 133-tick bars]

What does it mean? The rise came first and then the fall, and that made a difference in application of Elliott Wave Theory to the chart. Under the principal analysis, the peak, 5380, is the end of the 3rd subwave within the 5th-wave uptrend that began on May 31. The subsequent decline is the beginning of the 4th subwave within the larger wave 5.

If the wave reverses quickly and moves above 5380, then Alternative #1 comes into play.

What are the alternatives?

Alternative #1: It’s possible to see the rise as part of the 4th subwave. In that case the peak at 5380 would be the end of the B subwave within the larger 4th wave correction, and the still larger 3rd wave is still underway. On the chart under this scenario, wave 3{-7} is changed to wave B{-9} within wave 4{-8} within ongoing wave 3{-7}.

Alternative #2: Also, its possible that the larger 5th subwave is actually a degree smaller, as are all of its subwaves, and that they are part of a 1st wave with a still larger 5th wave. On the chart, the larger 5th wave changes from 5{-6} to 5[-7}, wave 1{-6} is inserted into the line-up, They’re all subwaves if wave 5{-5}.

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

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 3{-2}, 3{-3} and 3{-4} are underway, as is wave 5{-5}.
• Wave 5{-6} is underway and is in its middle subwave, rising wave 3{-7}.

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, June 7, 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.

3:30 p.m. New York time

Half an hour before the closing bell. The S&P 500 futures have fallen back to the 5340s during the session. Elliott Wave Theory: The decline is the 4th subwave within the uptrending 3rd wave within the 5th-wave uptrend that began on May 31.

I’ve updated the chart.

9:35 a.m. New York time

What’s happening now? The S&P 500 E-mini futures peaked early overnight at 5372.75 and then traded narrowly, dropping as low as the 5350s.

What does it mean. The peak, 5372.75, may well be the end of the 3rd subwave within a 5th-wave uptrend that began on May 31 under the revised Elliott Wave analysis described below. Although not necessarily. It could just as well be a stopping point within wave 3.

The map is not the territory. The 4th wave downward correction that I’ve been tracking mid-May broke a rule of Elliott Wave Theory. It moved beyond the end of the previous 1st wave. if that happens, then it’s not a 4th wave but something else.

Moreover, the rise during the June 5 session showed an energy typical a 3rd or 5th wave, subwaves of a larger trending wave.

In every edition of Trader’s Notebook, I quote the 20th century semanticist Alfred Korzybski. In his book Science and Sanity (1933), he wrote: “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 by implication, when the map no longer matches the territory — when the Elliott Wave analysis no longer matches the chart — then it’s time to draw a new map, to work our way through a new analysis.

Elliott Wave Theory is an exercise in pattern recognition. It’s true that the human brain is one of the best pattern recognition devices around. It’s also true that it is highly subjective in its conclusions. That’s human nature. And because of that characteristic, revisions are rare, and they must be embraced by the analyst without delay.

Wave labels. In this discussion I’ll use the wave labelling system that appears on the chart. Each wave number is followed by a subscript, in curly brackets, that tells waves distance from what Elliott Wave Theory calls the Intermediate degree. The present Intermediate degree, wave 5{0}, began in December 2018. A wave with {-6} in the brackets would be six degrees lower than Intermediate, what Elliott Wave Theory call the Submicro degree. It’s a way of distinguishing waves by their location in the fractal structure traced by stock prices.

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

The new analysis. The former analysis had wave C{-12}, the larger final subwave within a 4th-wave upward correction, wave 4{-11}, within the final subwave, wave C{-10}, of a downward correction, wave 4{-9}. It’s that wave 4{-9} that broke the Elliott Wave Theory rule described above, a 4th wave never moves beyond the end of the preceding 1st wave..[S&P 500 E-mini futures at 9:35 a.m., 90-minute bars, with volume]

The solution was to move the subwaves up by several degrees, bringing the correction into compliance with the rule. I did this by reworking the wave count within what had been wave 3{-6}, which was still under, so that wave 3{-6} ended on May 23, which in the prior analysis was the end of wave B{-10}.

That cleared the for the following decline to be a 4th wave, wave 4{-6}, and the push upward that began on May 31 to be wave 5{-6}, a subwave within uptrending wave 5{-5}, which began on April 18.

For a comparison with the prior principal analysis’ chart, look at the June 5 edition of Trader’s Notebook.

Implications for the future. Under the new principal analysis, the end of wave 5{-6} will also be the end of wave 5{-5} and its parent wave 3{-4}, which began on February 21 from 4959. Wave 3{-4} will be followed by a 4th-wave downward correction significantly larger than the 4th-wave corrections I’ve been tracking for the past months.

In terms of the strategic reality of the chart, very little has changed. With both the former and revised analyses, a 4th wave is nearing its end and an uptrending 5th wave is expected to follow. Under the new analysis, the 4th wave ended on May 31 and the uptrend has begun.

What are the alternatives? I’ve labeled the 5th-wave uptrend now underway as wave 5{-6}. It’s also plausible that the wave is a subwave one degree lower than 5{-6}, meaning the fractal tree would be wave 3{-8} within wave 1{-7} within wave 5{-6}, rather than what principal analysis labeling: Wave 3{-7} within wave 5{-6}.

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

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 3{-2}, 3{-3} and 3{-4} are underway, as is wave 5{-5}.
• Wave 5{-6} is underway and is in its middle subwave, wave 3{-7}.

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, June 6, 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.

3:30 p.m. New York time

Half an hour before the closing bell. The S&P futures rose during the session and was trading in the 5360s as the closing bell approached. Elliott Wave Theory: The 4th-wave upward correction that began on May 31 continues. Perhaps.

An ambiguity. The rules of Elliott Wave Theory say that a 4th wave can’t move above the end of the 1st wave within the parent wave. Yet that has happened according to the principal analysis. On the chart, wave 4{-11} has moved past the end of wave 1{-11}. Needs fixing, Top of my to-do list, for tomorrow morning’s analysis.

I’ve updated the chart.

9:35 a.m. New York time

What’s happening now? The S&P 500 E-mini futures rose overnight reaching into the 5320s.

What does it mean? Elliott Wave Theory sees the rise as the final subwave, wave C, of a small 4th-wave upward correction that began on May 31. When it is complete, it will also mean the end the correction and the beginning of a declining subwave that, when done, will also be the end of a larger 4th-wave downward correction that began on May 16.

What are the alternatives? The overnight rise clarified the subwave configuration within the smaller subwave upward correction. Expect further ambiguities to develop.

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

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 3{-2}, 3{-3} and 3{-4} are underway, as is wave 5{-5}.
• Wave 3{-6} is underway and is in its middle subwave, wave 5{-7}, which is in its final subwave, wave 5{-8}.
• Wave 5{-8} is in its next-to-the-last subwave, wave 4{-9}, a downward correction.
• Within wave 4{-9}, the final subwave, wave C{-10}, is underway and is in its next-to-the-last subwave, wave 4{-11}.
• Rising wave C{-12} is underway within wave 4{-11}.

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.

• 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 and index:
• 5{-1} Minor, 10/13/2022, 3502 (up) (futures), 3491.58 (up) (index)
• S&P 500 Futures:

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, June 5, 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.

3:30 p.m. New York time

Half an hour before the closing bell. The S&P 500 futures traded sideways during the session, remaining within a narrow range. This morning’s principal analysis, using Elliott Wave Theory, is unchanged: The 4th wave downward correction that began on May 16 continues to work through its end game.

I’ve updated the chart.

9:35 a.m. New York time

What’s happening now? The S&P 500 E-mini futures fell overnight, back into the 5260s.

What does it mean? In Elliott Wave Theory terminology, the decline is a small part of the final subwave of the downward correction that began on May 16. The final subwave is wave C, and it in turn is in its 4th subwave of five, a declining B wave that began on June 3. Itis a subwave within an upward correction that began on May 31.

What happens next? The small declining B wave within the upward correction will be followed by a rising C wave that will complete the 4th-wave upward correction, which will be followed by a downtrending 5th wave that will complete the final wave of the larger 4th-wave downward correction and the correction itself.

A 5th-wave uptrend will follow, and when complete, will be the end of two 5th waves of each larger than the other, and also a still larger wave 3, which began on May 2. The future 5th wave will be labeled wave 5{-9} on the chart — the wave number followed by a subscript, in curly brackets, showing how many degrees the wave is from Intermediate degree within the fractal structure of the chart. The Intermediate degree,, wave 5{0}, began in December 2019. Wave 5{-9} is nine degrees lower than the Intermediate degree.

5th-wave brats: Fifth waves are the unpredictable brats within a trend. They tend to move above the end the preceding 3rd wave — 5349 in this case — but sometimes they fall short, an event called “truncation”. And sometimes they continue for an ubexpectedly greater distance before reaching the end, a condition called “extension.”

And there is no way to tell ahead of time whether a 5th wave will be truncated, extended, or a normie.

Small-wave ambiguity. Back to the small waves within the 4th-wave upward correction. It’s possible to label the subwaves in several different ways. I’ve chosen the labelling that seems most likely, but others aren’t out of the question. The only response available to an analyst, at this point, is to quietly mutter, “Time will tell.”

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

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 3{-2}, 3{-3} and 3{-4} are underway, as is wave 5{-5}.
• Wave 3{-6} is underway and is in its middle subwave, wave 5{-7}, which is in its final subwave, wave 5{-8}.
• Wave 5{-8} is in its next-to-the-last subwave, wave 4{-9}, a downward correction.
• Within wave 4{-9}, the final subwave, wave C{-10}, is underway and is in its next-to-the-last subwave, wave 4{-11}.
• Wave B{-12} is underway within wave 4{-11}.

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, June 4, 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.