Here is a possible Ending Diagonal count for the SPX. I have put in a black count showing the ED pretty much complete as I write this, and a red count with another possible wave up to come before a reversal. Either way a break of the bottom trend line should offer a good signal to get short with a stop above the previous high. If this move down complete as an ED it will be the C wave of a large zig-zag from 1007.4, and I expect that price will reverse sharply from the high as it begins falling in a large 3 of 3. I have just taken a short from the top trend line in anticipation for a collapse. Anyone who follows me knows I have been trying to get on at the top of this move for some time. More conservative traders may want to wait for a confirmed break of the bottom trend line before getting short.
It is diagonal, but not ending diagonal.
ReplyDeleteEnding diagonal cannot be start from the bottom of the chart, it is possible only in W5 and C wave positions.
Could be leading diagonal also.
I had sometimes used and even traded this kind of bottom diagonals myself but havent found anyone would document them anywhere what it is in EW terms actually.
Summer Regards,
http://just-charts.blogspot.com/
Sorry Abel you must have misread the chart I posted I didn't put the "C" in because there wasn't enough room for me to do so once I'd already labeled everything else. The entire ED is supposed to be a C of 2 not a 2 complete. Take a look at a Daily chart and you will see what I mean - there is an ABC from the low and this is just a zoom of the C section. That said however this scenario is looking less and less likely by the minute. I now think we will likely continue to edge higher until US GDP stats are released on Friday.
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