3:30 p.m. New York time

Half an hour before the closing bell. The S&P 500 traded within a narrow range throughout the day, remaining below the future’s overnight high. The index remained below the November 5 high of 4718.50. No change in the analysis. I’ve updated the upper chart.

10:05 a.m. New York time

What’s happening now? The S&P 500 E-mini futures reached a new all-time high, 4723.50, in overnight trading and then pulled back slightly. The S&P 500 index, which doesn’t trade overnight, opened with its November 5 peak, 4718.50, still intact.

What does it mean? Assuming that the index will soon follow the futures in reaching a new high, the fresh peak means that the rise that began on October 12 is still underway, and the decline from November 5 was a shallow correction within the ongoing rise.

What’s the alternative? The details of the count on the upper chart may change. The correction that began November 5 seems disproportionally shallow, creating a degree of uncertainty

Charts. The upper chart is a closer view showing the futures from mid-October to the present. The lower chart is a broader view showing the index from late December 2018, the beginning of a large expanding Diagonal Triangle.

What does Elliott wave theory say? Under the new principal count, wave 5 of Bitsy degree — subscript {-9} — within wave 3 of Subminuette degree {-8}. Basically, the waves that the prior counts had seen as ending on November 5 did not end on that date and are still ongoing. The decline that began November 5 is wave 4 of Subminuette degree.

That wave 4 is extremely shallow even by 4th-wave standards. A standard target for 4th waves in Elliott wave analysis is the 4th wave within the preceding 3rd wave, which would be 4590 to 4548. The 4th wave under the new principal analysis ended at 4625.25. It doesn’t break any of the Elliott rules, but it is unusual.

The shallowness of the correction leaves the details of the count uncertain. They’ll start to make sense as the price continues on its way.

What is certain is that wave 3 of Minor degree {-1}, the third leg of the expanding Diagonal Triangle, has reached its end, Minor wave 4 will work its way down to the lower boundary of the Triangle, presently in the 1970s and declining further each day. The 4th wave will be followed by wave 5 of Minor degree, returning to continually rising upper boundary and ending the Triangle, which in its entirety is is wave 5 of Intermediate degree (no subscript). An extremely large decline will follow.

Wave 1 of Minor degree took a year a two months to reach completion. I wouldn’t be surprised if Minor wave 5 took that longer and possibly longer, and so we may be looking at 2023 or later for the Triangle to reach its end.

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 19, 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 futures launched into a 32-point decline spanning an hour this morning and then a recovery to just below the original level in the two hours that followed. 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 E-mini futures rose in overnight trading, remaining below Tuesday’s high, 4709.75.

What does it mean? The upward correction that began on November 10 is still underway, within a downward correction that began on November 5.

What’s the alternative? It’s possible that the correction from November 10 ended at yesterday’s high. Another alternative: If the price moves above the November 5 high of 4711.75, then the uptrend that began on October 27, and several larger uptrends that began before that, are still on the rise.

What does Elliott wave theory say? Under my principal analysis, the lowest degree that I’m tracking is wave 4 of Subbitsy degree — subscript {-10}. It is a subwave of wave A of Bitsy degree {-9} within wave 4 of Subminuscule degree {-8}. All of that comes within the parent, wave 3 of Minuscule degree {-7}, which began on October 4.

It’s possible that Tuesday’s peak ended wave 4 of Subbitsy degree. If that is so, then downtrending wave 5 of Subbitsy degree has begun.

If the price moves above the November 5 high, then wave 3 of Subminuscule degree is still underway.

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 18, 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 its slow decline during the day, remaining below yesterday’s high, 4709.75. 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 E-mini futures rose to 4709.75 within two points of the November 5 peak and then declined slightly

What does it mean? The pattern leaves uncertainty over whether the upward correction that began on November 10 is still underway, or whether the next movement, to the downside, has begun. I’ve marked the chart to reflect the first scenario: The upward correction is ongoing,

What’s the alternative? If the price continues to rise and moves above 4711.75, the November 5 peak, then that peak is likely just a stopping point on the the rise that began October 6 and that is still underway.

What does Elliott wave theory say? By my principal analysis, wave 4 of Subbitsy degree — subscript {-10} — is underway, an upward movement within wave A of Bitsy degree {-9}, which is the first portion of a three-wave corrective pattern, wave 4 of Subminuscule degree {-8}. Subminuscule 4 began on November 5 from 4711.75.

Last night’s high is the highest high point since Subbitsy wave 4 began. It could be that it marks the end of that upward correction, or there could be a bit more upside remaining. If Subbitsy wave 4 is a Flat pattern or a Zigzag, then it cannot move above the November 5 high, 4711.75. If it does move above that level, then it is either a Triangle of some sort, forming Subminuscule wave 4, or the November 5 peak didn’t mark the end of Subminuscule wave 3, which under this scenario is still underway.

It’s also possible that what I’ve treated as Subbitsy degree is really Bitsy degree, waves A and B, leaving only wave C to the downside to reach completion, marking the end of wave 4 of Subminuscule degree and the start of a rise to new heights as wave 5 of Subminuscule degree.

Time will provide us with evidence to sort these questions out.

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 17, 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 rose to a new high within an upward correction within a larger downward correction that began on November 5. The new high and so far reached 4709.75 on the futures and has eclipsed yesterday’s high of 4697.50. If the price moves above the November 5 peak of 4711.75, then that will mean that the rise that began on October 6 — wave 3 of Subminuette degree — subscript {-8} — is still underway, and the downward/sideways movement from November 5 was of a lower degree. The start of wave 3 of Subminuette degree is shown on the chart in red.

Today’s high validates the alternative analysis from this morning, and it becomes the new principal analysis. The new alternative would be a push above the November 5 high.

So, a You Are Here listing: Under the principal analysis, the S&P 500 is within uptrending wave 4 of Subbitsy degree {-10} within downtrending wave A of Bitsy degree {-9} within downtrending wave 4 of Subminuette degree.

9:35 a.m. New York time

What’s happening now? The S&P 500 E-mini futures traded within a narrow range overnight, remaining below Monday’s high of 4697,50.

What does it mean? My principal analysis sees a complex of nested movements: The non-committal move is an early stage within the final low-level decline within the first downward leg of a three-part sideways correction that began November 5 from 4711.75.

What’s the alternative? My alternative analysis places that final low-level decline in the futures, as the price continues to trace a small correction before the decline. When that small correction is over, the final decline that will bring the first part of the larger correction to an end.

Charts. The upper chart is half an hour before the closing bell, showing the alternative analysis, which was verified. The lower chart is shortly after the opening bell and shows this morning’s principal analysis, which has now been discarded.

What does Elliott wave theory say? Under my principal analysis, the sideways movement is an early stage of wave 5 of Subbitsy degree — a {-10} subscript on the chart — which is the final, declining portion of wave A of Bitsy degree {-9} within a wave 4 correction of Subminuscule degree {-8}. Bitsy wave A will be followed by a rising B wave that may again reach into the 4690s, and then by declining C wave that will complete Subminuscule wave 4. That 4th wave will be followed by Subminuscule wave 5, which will push above the November 5 peak to new heights.

Under my alternative analysis, the sideways movement is a subwave of wave 4 of Subbitsy degree, a rising correction that will be followed by Subbitsy wave 5. This analysis pushes Subbitsy wave 5 into the future, and when it is complete, the market will progress as described in my principal analysis.

Bottom line: The price will break out above the November 5 peak of 4711.75, the end of wave 3 of Subminuscule degree. The difference between the two analyses is about the timing of that breakout. Under the principal scenario, that breakout will happen sooner; under the alternative, later.

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 16, 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 began to decline during the morning in what may be the final leg within the first segment of a downward correction that began on November 5. In Elliott wave terms, my principal analysis sees the day’s decline as wave 5 of Subbitsy degree — subscript {-10} — within wave A of Bitsy degree {-9} within wave 4 of Subminuscule degree {-8}. The alternative analysis sees wave 4 of Subbitsy degree as still underway. I consider the alternative to be of lower probability because wave 4 of Subminuscule degree and its internal waves must remain below the November 5 peak of 4711.75, and there’s just not that much upside remaining above today’s peak of 4697.50. I’ve updated the chart.

9:35 a.m. New York time

What’s happening now? The S&P 500 E-mini futures rose into the 4690s in overnight trading as the downward correction following the November 5 peak, 4711.75, continues. Within that correction, a smaller, upward correction has been underway since November 10, and the chart can be interpreted to mean that the smaller correction is in its last leg.

What does it mean? The end of the smaller correction will be followed by a decline into the low 4600s and perhaps lower. The end of the decline will also mark the end of the first leg of the larger correction that is underway.

What’s the alternative? The overnight high has come within 15 points of the November 5 peak. If the price exceeds the peak — 4711.75 — then that will trigger a reworking of my principal analysis.

What does Elliott wave theory say? The price is in rising wave 4 of Subbitsy degree — subscript {-10} — within wave A of Bitsy degree {-9} within declining wave 4 of Subminuscule degree {-8}. When Subminuscule 4 is complete, the subsequent wave Subminuscule 5 will carry the price above the November 5 peak.

Although Subbitsy wave 4 appears to be in its 3rd and final wave, it is possible that it will form a compound correction, adding on a second corrective pattern.

The Subminuscule wave 4, if it behaves typically, will end in the 4th wave of the 3rd wave one degree lower. I’ve marked that range with a tan circle on the chart.

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 15, 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 rose slightly during the day, remaining well below the November 5 peak. No change in the analysis. The upward correction, wave 4 of Subbitsy degree within wave A of Bitsy degree within Wave 4 of Subminuscule degree, continues. I’ve updated the upper chart.

9:35 a.m. New York time

What’s happening now? The S&P 500 E-mini futures traded within a narrow range overnight.

What does it mean? The price continues to trace out a low-level upward correction within a higher level downward correction that began on November 5.

What’s the alternative? The main ambiguity has been how low of a level describes the present smaller correction. At this point it looks like the chart is labelled correctly. More on the subject in the Elliott wave theory section, below.

Charts. The lower chart shows a closer view of the S&P 500 E-mini futures stretching back to mid-October. The upper chart shows a broader view, of the S&P 500 index back to December 2018.

What does Elliott wave theory say? The low-level upward correction is wave 4 of Subbitsy degree — subscript {-10} — within wave A of Bitsy degree (-9} within the larger wave 4 of Subminuscule degree {-8}, a downward correction that began from the November 5 peak. (I use the subscripts for degree-labelling on the charts.)

As always in the early stages of a market movement, I’ve seen some ambiguity about the degree labelling. One degree down from Bitsy degree is Subbitsy, but it’s impossible to know wether or not the waves I labelled as Subbitsy actually are at the subscript {-10} level, or perhaps at {-11} or {-12}. It matters, because the smaller degree labelling impacts how I label the larger degrees.

At this point I’m comfortable with using the Subbitsy degree as the label for the smallest degree I’m tracking on this chart.

Fourth waves tend to be shallow, and the S&P 500’s present positioning is a 4th wave correction (Subbitsy) within a 4th wave correction (Subminuscule). All of that is happening within a rising 3rd wave of Minuscule degree {-7} within a 1st wave of Submicro degree {-8}, and going higher, within a series of 5th waves all the way up to wave 5 of Minute degree {-2}, which is within wave 3 of Minor degree {-1} within wave 5 of Intermediate degree (no subscript). The entire rise from the low of the early pandemic crash on February 23, 2020 is wave 3 of Minor degree.

Wave 5 of Intermediate degree is an expanding Diagonal Triangle that began on December 26, 2018.

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 12, 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 back slightly from its peak of the day. No change in the analysis. Wave A of Bitsy degree within wave 4 of Subminuscule degree continues. I’ve updated the chart.

2:15 p.m. New York time

My trades. I’ve closed by short bear call options spread on FXI for a loss and updated the entry analysis with results.

9:35 a.m. New York time

What’s happening now? The S&P 500 E-mini futures rose slightly in overnight trading, reaching 4661.50, and then fell slightly at the opening bell.

What does it mean? The rise is the second upward correction within the first downward leg of a larger correction that began on November 5.

What’s the alternative? The rise could be a level or two smaller than in my principal analysis, which means that the first leg of the larger correction has earlier potential to the downside.

What does Elliott wave theory say? Under my principal analysis, the rise is wave 4 of Subbitsy degree within wave A of Bitsy degree, the latter being the first wave within a 4th wave correction of Subminuscule degree. The 4th wave of Subbitsy degree will be followed by a 5th wave decline that will likely bring the price within the correction’s target range, defined by the 4th wave of Bitsy degree within the 3rd wave of Subminuscule degree. I’ve marked that 4th wave on the chart with a tan oval.

Under my alternative analysis, the rise is part of a degree one or two levels below Subbitsy within declining wave 3 of Subbitsy degree. This scenario increases the likelihood that Subbitsy wave 3 will reach the target range before the subsequent wave 4 carries the price higher again.

The practical differences between the two scenarios is quite small. Under the principal analysis, the decline into the target range will come later than is likely under the alternative scenario.

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 11, 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 sharply beginning shortly before noon and has so far reached a low of 4625.25, putting it within 35 points of the target range: Wave 4 of Bitsy degree within wave 3 of Subminuette degree, stretching from 4590 down to 4543.75. No change in the analysis. Wave 4 of Subminuette degree continues. I’ve updated the chart.

9:35 a.m. New York time

What’s happening now? The S&P 500 E-mini futures continued their decline in overnight trading, reaching a low of 4656.75.

What does it mean? The correction that began on November 5 has a target in the 4590 down to 4543.75 range. The low puts the price 67 points above the target’s upper boundary. The lower the price descends, the more likely this principal count is correct. The target is marked on the chart by a tan circle.

What’s the alternative? It’s possible that November 5 wasn’t the end of the rise that began October 12 and that the correction we’re seeing is at a smaller level. The further down the price goes, the less likely this scenario is.

What does Elliott wave theory say? By my principal analysis, the correction is wave 4 of Subminuscule degree. The target is the 4th wave one degree lower within wave 3 of Subminuscule degree. Internally, Subminuscule 4 is in wave A of Bitsy degree, and within that, wave 3 of Subbitsy degree.

The completion of wave 4 of Subminuscule degree will mark the beginning of a 5th wave rise to new highs, which in turn when complete will mark the end of the parent wave 1 of Minsucule degree.

So, long story short: Shallow correction, new highs. Sideways for the short term, upward for the slightly longer term.

By my alternative analysis, wave 3 of Subminuscule degree is still underway, and the pullback is a lower degree correction that will soon reach its end as the 3rd-wave uptrend removes.

Long story short: The same as with the principle analysis (above), except a shallower correction and a longer wait for the end of Minuscule wave 1.

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 10, 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 decline below the sideways movement that has defined it since the November 5 peak. The decline adds a bit of weight to the idea that November 5 marks the end of wave 3 of Subminscule degree, and that the 4th wave has begun. The 4th wave target range, discussed below, remains valid. I’ve added a new chart with the revised mark-up, leaving this morning’s chart with the old mark-up for comparison.

What I’ve marked after November 5 as waves 1 , 2 and 3 with a {-10} subscript, indicating Subbitsy degree, may well be a or two below Subbitsy. The chart will gain clarity as the post-November 5 decline develops.

1:35 p.m. New York time

My trades. Today is the last day under my rules to enter an options spread position using contracts that expire December 17. The ambiguity that I see in the S&P 500 also exists in various forms in my prospective trades. So I’ll be trading simple long calls and puts, and shares, until the entry period for options expiring January 21. Entry runs from November 30 to December 14, with December 7 being the optimal date.

Meanwhile, my short bear call spread on FXI is slightly above the profit zone. It expires next week on Friday, and ideally I’ll be out of the position before the end of this week, for a profit or a small loss.

9:35 a.m. New York time

What’s happening now? The S&P 500 E-mini futures continued to move sideways, having completed three waves and embarked on a fourth.

What does it mean? If the price moves above the November 5 peak, 4711.75, then the correction is over and the uptrend has resumed.

What’s the alternative? If the price remains below 4711.75, then the chart is ensnared in a great deal of ambiguity. The correction seems too shallow to be at the level of the rise that began on October 27, or even down one level from that. I discuss the targets in the Elliott wave theory section below.

(The chart below is the old mark-up from this morning, which has the rise still underway. The chart above, posted shortly before the closing bell, shows the revised mark-up with the rise ending on November 5.)

What does Elliott wave theory say? The S&P 500 is present in wave 5 of Subbitsy degree within wave 5 of Bitsy degree within wave 3 of Subminuscule degree. The sideways movement beginning November 5 is a 4th wave correction within wave 5 of Subbitsy degree.

A 4th wave differs in form from the prior 2nd wave of the same degree. That is, if wave 2 is a Zigzag, then wave 4 will most likely be a Flat. And indeed, within wave 3 of Subminuscule degree, Bitsy wave 2 was a Zigzag and so the 4th wave correction most likely will be a Flat or a Triangle.

If a 4th wave correction takes the form of a Flat, it tends to reach down into the range 4th wave one degree lower within the preceding 3rd wave. In this case, if wave 4 of Subminuscule degree has begun, it should reach down to the range of wave 4 of Bitsy degree within wave 3 of Subminuscule degree. I’ve marked that 3rd wave on the chart with a tan circle. The range is 4543.75 up to 4590.

The present sideways pattern at its lowest is 80 points above the target range. And so, is the correction a 4th wave of Subminuscule degree, or of some lower degree.

The target range is a tendency, not a firm expectation. So this extremely shallow correction could be wave 4 of Subminuscule degree. But it’s not a certainty, and I’ve refrained from labelling it that way on the chart.

The ambiguity can be resolved either by the price exceeding the November 5 peak, meaning that wave 3 of Subminuscule degree is still underway, or by the price declining to within, or at least close to, the range marked by the tan circle, which would mean that wave 4 of Subminuscule degree began on November 5.

Give the low degree of the conundrum, I expect a resolution of the question within days, a week or so at the longest. That’s a guess, not a guarantee.

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, November 9, 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 remained below Friday’s peak so far in the trading session. The price has traced three waves down, three waves up, and now has entered the last leg, which should have five waves internally. The problem with this analysis is that the price is barely 10 points below the peak, and the more likely target would bee around 100 points below the peak. There’s something happening here, but what it is isn’t exactly clear. I’ll retain my present count, that wave 3 of Subminuscule degree is still rising, until the chart regains its clarity.

9:35 a.m. New York time

What’s happening now? The S&P 500 E-mini futures moved up in overnight trading, so far remaining below Friday’s peak of 4711.75.

What does it mean? The rise could be a resumption of the uptrend that began November 3 and could lead to new heights.

What’s the alternative? Or the rise could be a small upward correction in a downtrend that began from the peak of November 5.

What does Elliott wave theory say? Under my principal analysis, wave 5 of Subbitsy degree within wave 5 of Bitsy degree within wave 3 of Subminuscule degree remains underway.

Under my alternative analysis, Subbitsy 5, Bitsy 5 and Subminuscule 3 ended at Friday’s peak, and the present wave is Subbitsy A within Bitsy A within Subminuscule 4, a correction that will most likely take the form of a Flat.

At this point, in my view, both analyses have an equal chance of playing out.

If Subminuscule 4 is a Flat, it’s likely target range is the boundaries of wave 4 of Bitsy degree within the preceding wave 3 of Subminuscule degree, ranging from 4543.75 up to 4590. I’ve marked that wave with a tan oval on the chart.

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, November 8, 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.

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Based on a work at www.timbovee.com.