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hi there cyril trader here i'm going to do an update on the major use indices and there's certainly been some nice action since the last video there which i believe i did on wednesday uh so let's just jump into the hourly chart here on spx so this is what i'm currently leaning on is kind of my uh now there's i'll uh say right now there's multiple scenarios that are potentially in play here and i'll go through some of them not even all of them um but this is the one i'm kind of leaning into right now and that's where we had this initial five wave move down into potentially larger wave one uh and that was into the low at 37 32 48 then we had this nice uh sharp bounce up possibly for a wave two and that was into the uh oh 38 30 level or so and now we're potentially working this wave three the downside uh of possibly a larger a or a larger one and keep in mind where i have this wave three four and five label placed these are just placeholders uh in all likelihood if you had a third wave to the downside you'd be looking at at least kind of this zone between the 1.32 and 1.618 uh fib relationship between one and three so you'd be looking i don't know maybe some pressure down to the low 3600s in this third wave if that's what we have materializing here uh but just to keep things kind of tidy i have it more like this right uh okay so again this is kind of my lead well the one i'm leaning on more than the others uh although i never have too strong with opinion unless something's just really really crystal clear and i don't think we're quite there yet as far as clarity uh so again yeah just to go over it this would label this uh move off the 3662 low over here as a five wave ending diagonal possibly ending a larger wave five potentially of a larger wave three or again on the longer term chart if you counted a certain way a larger wave five now if that was the case then we're gonna have a pretty substantial correction uh and so far we've turned down uh but again until you actually take out this low over here here's the level that really kind of gained some traction as far as more downside in my opinion is if we take out this 36 62 low uh that that kind of tilts the odds more towards this interpretation of a but potentially larger degree more severe longer lasting uh corrective move to the downside or even trending move to the downside depending on that larger degree wave interpretation now i'll go look at this and there's still a bullish case here until this level gets taken out and i'll exact go go through exactly what i mean so again as long as this so since this this was the low of our last corrective swing by my uh interpretation here that 36 6271 you could also label this as a leading diagonal one two three four five for leading diagonal wave one this is an a b c down for a wave two and now we're potentially starting to head up we're going to be starting it up in a wave three obviously to new highs and again these these are just placeholders you'd be looking you know at substantially higher levels in wave three four and five and again to be proportional they'd be much higher even than what i'm showing here uh but just to kind of show you the uh expected kind of movement of the pattern not the exact levels or uh the time at which it will happen just kind of placeholders uh but let's just drag this all back down here just so i can get into the scale i want again here um so yeah this is absolutely viable and here's the bowl case so you got a three-way move down so far and if you label as an abc you have the ac equality relationship that we almost hit 36 90 208 we hit 36 94 12 and got some sort of reaction off of there at least now is that low going to hold are we just going to keep going down i personally think uh you know we're going to continue going down uh in my previous scenario in more of a third wave to the downside but if this low holds by chance i mean this is certainly viable you can go leading diagonal five up abc zigzag down and heading up in uh you know wave three and we're not done making new highs yet this is this scenario is intact as long as we hold this level so again the more bearish or i guess larger downside potential interpretation definitely gains a lot of traction taking out this level at 36 62 71 but if you want to try and go long and gains that level i mean we're pretty close to that so that's a pretty reasonably tight stop if we do actually turn back up again not a bad attempt at a long at least although i wouldn't be overly confident um and you know we'll go over some reasons for that as i progress through this video but anyway i just wanted to show you the very much valid bullish interpretation and where it would become invalid which is important information so a lot of the elliott wave uh methodology people get wrapped up and trying to predict too often when they should really just be sorting uh possibilities and then weighting them more so as probabilities as things kind of develop so right now this is possible as is my first more bearish interpretation as as far as which one is more probable hard to give a real solid edge right now i mean as long as we hold this level this certainly has a degree of probability but the nice thing is you know where this this interpretation absolutely falls apart and is invalid and that's for the real use i think of of the wave principle overall is knowing where you're wrong knowing where if you're bullish you should stop being bullish or vice versa and i think in that sense that that key level here to hold if you're trying to remain bullish is that 36 62 71. so keep that in mind uh okay i think i've gone through this scenario enough again the first scenario uh still has a diagonal but instead an ending diagonal and we're starting a larger impulsive move down for possibly a larger wave a or1 again once you start going to higher higher degree uh labelings you're just uh it's basically like you're you're speculating on what the larger pattern is going to be even though you're still just tracking the smaller pattern so i don't want to go on too high of a time frame here when we're tracking these these shorter term patterns let's just kind of keep it on on the shorter term scale uh and then let the mark kind of reveal more about the larger patterns as they develop right now just not enough development to have a high confidence view of what a larger uh pattern is going to look like uh but we do have some good information we we we definitely have this five wave impulse to move down uh we have a internal retracement a partial retracement of that move and we've made another leg down to new lows so that's that's the real solid information we currently have i think it looks like we're good to continue a little bit more downside here and again if we do take of that 36 6271 uh i think uh more downside is going to become kind of the favorite interpretation but right now uh it's not a high confidence um chart at the moment uh it could basically go either way as i pointed out between this one and this one right uh okay now another i'll just this is a 15 minute time chart so a little shorter time frame than i normally get into on these videos uh but darren in the comment section on the last video i think what he was uh asking is did we just do an a like an abc up for a abc down for a new low to a b and then are we going to come up in a c wave for potentially a larger uh running or expanding flat of course it'd be an expanded flat if we get above uh this high up here at 38 30 50 but if we do five waves up to a uh uh a level lower than that it could be considered a running flat or wave c does not make a new extreme beyond wave a and again that could be where we have this five down for a or one then we have a b c either running or expanded flat for b or two and then we come down for c or three etc uh so on on a shorter term basis uh this is certainly a possible interpretation uh although i think you're adding a layer of complexity that you don't need to yet okay so i like to keep stay with the simplest interpretation until you're forced to adopt a more complex interpretation that's the way i like to operate here with counting the waves so for me uh the simplest and currently i guess we'll call it slightly favored interpretation by me is that we just got five down for one some sort of three three-way move up for wave two and you can see uh and part of this interpretation is okay the most common retracement level for a wave two is you know the 61.8 retraction level now we slightly exceeded that we basically landed in between the 618 and the 786 so that's a very almost uh desirable wave 2 retracement and a sharp deep wave 2 and then we've come down fairly substantially in a you know a nice impulsive fashion the downside so that kind of has me leaning on just so far labeling this move down as a simple impulse wave in development so one two three looking for three four five right uh so right now i have no reason not to label it this way it certainly is currently acting like an impulse wave to the downside uh so that's why i'm kind of leaning on this one but again as i said this certainly valid uh ideally you want to hold this level 3694 uh for this bullish interpretation hold but the actual level of invalidation would be 36 62 71. and you can see i did a fib retracement of this entire diagonal here uh and we pretty much reacted off that 76 retracement level you can see we had a little spike down but largely reacting off the 76. so if this is one deep two to the 786 and the ac equality and we start coming up you know substantially here you just can't discount that the bulls aren't done here yet they might not be uh i kind of think they are i'm leaning towards that but i'm definitely aware of this scenario where they're not done and we still got some more upside here in february but they really got to prove that uh before i believe it i honestly i won't believe it and wait unless we actually make a new high above 38 70 90. that's the only way i'm actually gonna fully fully accept that we still have this impulse wave to the upside in development and substantial new highs now that's a long ways up from here uh but just analytically i i won't actually turn to accept this as kind of like my lead interpretation unless we actually break new all-time highs okay i think i've kind of beaten the the wave counts to death here i'd like to go into the uh thinkers from candlestick charts go through some stuff on there so here's here's where the other things aside from just the wave principle so a lot of times you'll have multiple valid scenarios with the wave principle that's pretty common occasionally you only have a couple and then even more occasionally than that you only have a couple and they both kind of point to the same direction that's kind of like the real high confidence trade setup that i like to look for but the rest of the time you're basically just sorting possibilities uh and not necessarily um getting getting amazing trade setups okay but the occasional time when everything's kind of lining up super clear and even multiple scenarios are all kind of pointing to the same thing uh as long as well as other uh complementary things i look at here that's that's the high confidence trades and right now we're not in that situation yet okay back to this so daily candlestick chart and spx so we had a gap down after a little bearish engulfing candlestick here uh and that was on the 26. so this is actually technically a valid bearish cal stick because the prior real body which happened to be kind of this hanging man candle that prior real body was fully engulfed by this even though they're both pretty small bodies so technically a bearish engulfing candlestick and that did mark the high nice gap down follow through we had a partial bounce up you can see we're rejecting the daily t line here so normally in an uptrend you bounce or find kind of support around that daily t line in a downtrend you start finding resistance around that daily t line so that's notable kind of a shift in the way it's reacting around these moving averages just everything else aside just looking at those uh we've lost a 20 period simple moving average which was providing quite good support throughout this uptrend we've lost that now so that's notable and we've basically just closed let's see where's the 50 days of moving average it's 37 15 95 we've closed at 37 14. so we can we can say we've essentially kind of reacted around and closed that 50-day symbol moving average our oscillator is coming off toward getting towards oversold but not actually even oversold yet uh so that's what can be remarked here on the daily candles now on the weekly i think uh i mentioned this in the last video let's keep an eye on this weekly bearish engulfing see if it actually forms well it did form so that's a more significant candlestick on a higher time frame i think the candlestick signals have uh i will give them more weight or more significance and this is certainly a significant one so this is a weekly bearish engulfing candlestick on spx engulfing one two three yeah four prior real bodies so we've impr we've engulfed the real bodies of four prior weeks in a single week we've closed below the weekly t line we're coming off that overbought condition on the weekly just starting to come off of it so to me this is potentially on the larger time frame a more significant bearish signal and usually the more prior bodies the engulfing candle engulfs the more significant or powerful the signal is so this is certainly worth noting this weekly bearish engulfing candle engulfing four prior weeks okay uh so i would definitely want to point that out that really caught my eye so that makes me lean a little more in to the more bearish elliott wave interpretation uh give it a little more credence if you will uh dow jones industrial average same situation we're breaking down here now the dow is already broken and closed well below it's 50 day simple moving average so definitely some [Music] at least relative to that moving average setup it's acting weaker than spx and you can see we're respecting this daily t line as resistance instead of support so definitely a little downtrend developing here getting towards the oversold condition on the oscillator but not even oversold yet and remember you can certainly stay oversold or overbought for an extended period if you have a trending move so worth mentioning ah what do we got going on here weekly candle on the dow let's see here now is this a engulfing candlestick on the weekly let's see this week closed at the prior week closed at thirty thousand nine ninety six ninety eight and we opened it thirty thousand nine eighty nine eighty five so we didn't open quite high enough for this technically to be a bearish candlestick although it's certainly a bearish candle you can see we had kind of these small bodies with uh you know sizable upper shadows kind of rejecting these higher levels the last couple weeks and then we've had the breakdown closed below the weekly t-line just starting to come off the overbought oscillator on the weekly um so yeah dow looks poised for more downside as well definitely breaking um nothing really substantially different than spx nasdaq composite you can see on the nasdaq composite we are the mighty uh the tech index is even cracking you know take a picture it's amazing it's actually going down right uh now you can see over here we had this weekly uh hanging man candlestick so whenever you have uh what would be considered a bullish hammer if you're at the lower end of the range when you have that candle at the upper end or at the top of a range in this case all-time high obviously top of the range overbought etc that's considered a hanging man candlestick potential reversal the following week on the composite you did not make a new high or sorry the following day sorry i'm on the daily chart here i got mixed up daily chart so hanging man candle and that was on the uh 25th and then i believe this was a little bit of a bearish involving cal state let's see uh this candle opened at thirteen thousand six eighty one twenty one this thirteen thousand six eighty one seventy two so this opened just high enough to be a bearish engulfing let's see if it closed low enough this closed at thirteen thousand six thirty five ninety nine this closed at thirteen thousand six twenty six oh seven so yes this is a small but valid bearish engulfing candlestick engulfing the real body of this prior hanging man candle so interesting kind of little bearish two candle combination then obviously some follow through nice gap down didn't go up to fill the gap just continued to show weakness and now we're below the daily t line we're below the 20 period some simple moving average and the 50 civil moving averages you know fairways below us and that could be a potential target here on the nasdaq composite oscillators coming off the overall condition nowhere near oversold and on the weekly candle for the nasdaq composite we got a weekly bearish and almond candlestick on the nasdaq so that's certainly worth noting as well although it engulfs only one prior candle the real body of the prior week but nonetheless a legitimate weekly bearish candle bearish and golfing okay so that's why i wanted to go through this point all those out on the vix the vix to me it looks like it's just kind of consolidating in a volatile but still high range the vix certainly isn't absolutely tanking which would be more bullish i would think uh for the market the vix is staying elevated certainly chopping around but at a much higher range higher level than we were at so vic's uh definitely not negating the bearish uh bearish interpretations at the moment uh and what do we have i mean i don't usually look at weekly vix candles but just out of curiosity let's have a look um okay yeah that's definitely a noticeably large weekly green candle of x not much else to say other than that and i want to look at the vex vvx tool so let's do that and this is on a legitimate sell signal right now so for a while we had these big divergences building up where vvics and vix were basically making higher lows uh and i guess at least on on certain uh degrees higher highs but more importantly making higher lows not trending down actually starting to trend up both of them all the while spx was still making higher highs and higher lows so normally when you have that inverse relationship spx keeps going up vicks and vvx keep going down sideways to down right in this case they're going sideways to up even though this was going up so that was the big divergence that developed we got the break here where vvics got above the red moving average convincingly spx got below the blue moving average conventionally then look at this i think it's kind of cool so we had a nice uh follow through from the sell signal now we had this big bounce up but where did the bounce falter at right at the blue moving average so fibonacci retracements and wave relationships and everything else aside just this mechanical uh study if you will that has this blue moving average which is the uh now i did a video about this before uh but it's the 65 period uh simple moving average on the 30 minute chart so basically in an uptrend kind of acts as support in a downtrend kind of acts as resistance now just a nice little example of that occurring where we bounced up substantially but look acted as nice resistance there which also happened to be a nice kind of fibonacci uh retracement area but aside from that just this simple moving average kind of did its job in this case right so just i point that interesting and according to this tool i mean let so was this the bottom here we made on friday i sure don't think so uh and just never mind everything else but looking at this tool okay so vixx made a new high on friday vvics made a new high on friday simultaneously spx made a new low on friday so there's no divergence so i'd actually get a tradable bottom what you'd probably want to see and you usually do is you'd see vixx and vvx kind of diverge maybe vix makes new high but vvx fails to or vice versa so a little bit of a divergence there between the two and then that kind of sets spx up for a reversal and potentially a tradable low but right now everything is just kind of working without any divergence new eyes in vvx new highs and vix new lows in spx all simultaneously so to me i i doubt that we have the low in place here that's that's really what the message is um okay yeah that's really what i want to go through on the major indices uh i'm gonna do some more videos i got a request for xle i'm also going to do a bitcoin update because i think uh the pattern development there certainly requires an update from the last video and all right everyone have a great weekend watch the other videos if you're interested comments or questions or insults whatever just put them in the comment section all right serial trader signing off