US 30 Update - 4 Scenarios To Consider
Here's two bullish and two bearish possibilities, represented on two charts. I am cautiously leaning bullish for the time being, but I believe things could develop in either direction.
This is a strength of Elliott Wave Theory, by the way - having multiple counts. Many people frown upon it. They like to criticize the subjectivity of EWT, arguing that if different interpreters can come up with completely different counts, it's not a reliable market forecasting method. But I would argue the opposite is true. Sometimes you can come up with 5 different counts, all equally valid, and all which may completely disagree with one another on one time frame, but which develop a confluence on some other time frame. In such cases, that confluence allows one to have greater confidence in the forecasted move. Alternatively, in situations such as this, with an equal number of valid bullish and bearish possibilities, the lack of confluence on the lower time frames argues for extra caution.
It's irrelevant what the exact count is. What matters is whether the implications of different counts tend to align or diverge. That's what yields confidence (or lack of confidence) in a predicted move, and that's the true strength of EWT.
I don't think I'll be entering any swing trades to finish the week. I'll be sticking to scalps on the lower timeframe trends until this develop into a move definite direction.
This is a strength of Elliott Wave Theory, by the way - having multiple counts. Many people frown upon it. They like to criticize the subjectivity of EWT, arguing that if different interpreters can come up with completely different counts, it's not a reliable market forecasting method. But I would argue the opposite is true. Sometimes you can come up with 5 different counts, all equally valid, and all which may completely disagree with one another on one time frame, but which develop a confluence on some other time frame. In such cases, that confluence allows one to have greater confidence in the forecasted move. Alternatively, in situations such as this, with an equal number of valid bullish and bearish possibilities, the lack of confluence on the lower time frames argues for extra caution.
It's irrelevant what the exact count is. What matters is whether the implications of different counts tend to align or diverge. That's what yields confidence (or lack of confidence) in a predicted move, and that's the true strength of EWT.
I don't think I'll be entering any swing trades to finish the week. I'll be sticking to scalps on the lower timeframe trends until this develop into a move definite direction.
Comment:
The 4th scenario is now invalidated, having surpassed the week's high. That gives me a little more confidence that the markets are turning up, following this morning's pullback. I'm still watching that 3rd scenario as a possibility, though.
