October 24, 2023: NASDAQ Elliott Wave and Technical Analysis – Video and Charts

A lower target is used for the bullish Elliott wave count.

Summary: Upwards movement is expected to the next target at 17,090.

Note that the S&P 500 and NASDAQ do not always find highs and lows together. The last all-time high for the S&P 500 was on January 4, 2022, whereas the last all-time high for NASDAQ was November 22, 2021.

Last updated monthly charts are here.

BULLISH WAVE COUNT

WEEKLY CHART

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Intermediate wave (4) is labeled complete at the October 22nd low. 

If intermediate wave (4) continues lower, then it cannot enter intermediate wave (1) price territory below 11,210.38.

An Elliott channel is drawn using Elliott’s second technique. Draw a line from the end of intermediate wave (2) to the end of intermediate wave (4), with a parallel copy placed at the end of intermediate wave (3). Intermediate wave (5) may find resistance at the upper edge of the channel.

If this channel is broken to the downside, then intermediate wave (4) may be incomplete and would then be expected to continue lower.

Intermediate wave (5) has a target calculated at 17,090, where intermediate wave (5) will reach equality in length with intermediate wave (3).

DAILY CHART

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Intermediate wave (4) is labeled complete at the October 23rd low, subdividing as a double zigzag.

An Elliott channel is drawn, using Elliott’s first technique, around minor degree movements within intermediate wave (4). Draw a line from the beginning of minor wave W to the end of minor wave X, with a parallel copy placed at the end of minor wave W. If price breaks above this channel, then there will be confidence that intermediate wave (5) has begun.

BEARISH ELLIOTT WAVE COUNT

WEEKLY CHART

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This alternate sees cycle wave IV incomplete and expects the current bullish movement to be a rally within a larger bearish trend. For the long term, price is expected to continue down for the end of primary wave Y and cycle wave IV.

A channel is drawn using Elliott’s second technique. Draw a line from the end of minor wave 2 to the end of minor wave 4, with a parallel copy placed at the end of minor wave 3. Minor wave 5 may find resistance at the upper edge of this channel.

Intermediate wave (C) has a target calculated to reach 1.618 times the length of intermediate wave (A) at 14,326.

Once primary wave X is labeled complete, a low below 12,269.55 will add confidence to this wave count because it is the invalidation of the main wave count.

DAILY CHART

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This wave count sees minor wave 4 subdividing as a complete double zigzag.

If minor wave 4 continues lower, it may not move into minor wave 1 price territory below 11,210.38.

An Elliott channel is drawn, using Elliott’s first technique, around minute movements within minor wave 4. Draw a line from the beginning of minute wave w to the end of minute wave x, with a parallel copy placed at the end of minute wave w. If price breaks above this channel, then there will be confidence that minor wave 5 has begun.

TECHNICAL ANALYSIS

WEEKLY CHART

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Price continues to consolidate.

Volume pushed price lower last week, though volume overall declines.

DAILY CHART

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Price finds a small bounce with overall declining volume.

ADX indicates a bearish trend. This trend is not yet extreme and may continue.

RSI, Money Flow Index, and Stochastics all indicate bullish divergence, with RSI exhibiting double bullish divergence. Price has made lower lows, while these indicators have made higher lows. This may indicate a bounce in price soon.

NAAD WEEKLY CHART

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Nasdaq price is making higher highs, but the Nasdaq AD line has made lower highs. This divergence is bearish, and it shows that the rise in price does not have support from rising market breadth.

Nasdaq AD line is making new lows while price makes higher lows. This bearish divergence continues back to 2009.

Published @ 05:52 p.m. ET.

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Follow my two Golden Rules:

1. Always trade with stops.

2. Risk only 1-5% of equity on any one trade.

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New updates to this analysis are in bold.

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