TJ's Ellipsed missed

[jkeech]

Hi, from the attached chart on OVTI, what do you read into a TJ's Ellipse (both short and normal) being missed like I have shown?

I have drawn this from the wave 2 to wave 3 count.

The Ellipse tool is quite new to me and I'm not sure what I should be getting out of seeing hit missed or hit such as this (if I had been looking for a type 1 trade here).

Also, I notice there is no PTI or Wave 4 channel lines showing - why would that be?

Many thanks, John.

[ACM]

John
Once wave5 is labeled PTI and wave4 channels are taken out.
As to the Ellipse there are a couple of threads in this forum that you may want to look at (assuming you have not already done so). To see those threads you may have to increase the lookback period for messages in the forum.
Alex

[Nate McCartney]

John,

If there is not much of a retracement during Wave 4 (in this case, just over 25%) then you may need to choose a differen pivot from which to take your Ellipse, if the Wave 3 is very long, as on this chart. In the picture, I have turned off the Elliott count, and turned on the Pivot study. I then turned on the Intermediate Pivots, as there were no Primary or Major pivots between 2 and 3. I used the Intermediate pivot shown in the chart, which has the Short Term Ellipse catching the level for Wave 4. I hope that is helpful to you.

This is not necessary very often, as most Wave 4s (60% or so) retrace between 38% and 50%. In that case, the Ellipse drawn from Wave 2 to Wave 3 usually comes in just fine.

Nate McCartney

[ACM]

Following up on my earlier reply here is what the Ellipse does in broad terms.
It measures the maximum allowable countertend swing that will still maintain intact the primary trend.
With that definition in mind then the Ellipse plotted in the chart you posted suggests that the trend was re-established well within the allowed excursion as measured by the Ellipse.
Alex

[jkeech]

Thanks guys,

So Alexis - on my chart this is actually a good thing then ... as the price movement has remianed well inside the Ellipses???

[ACM]

John
If I understand your question correctly then yes assuming you were already long. If on the other hand you were seeking an entry then you would have missed it.
Alex

[jkeech]

Understood, thanks ... John.

[MR]

Here is a simple ellipse sample.