Alcoa update [AA]

My last few posts have been bearish on Alcoa and indeed it has not behaved well since it put in its 5th wave up.  The shares are signaling significant short term distress is right ahead after having gone up too far too fast.  What we see below is the initial declining double top that spelled trouble followed by a break back into the channel (1st confirmation that the expected A-B-C retracement is under way) and then a back test of the upper channel line from below to create, at least so far, an even larger declining double top.  This is looking very much like Owl Ears getting ready to drop off the right hand side of the chart.  Because that 5th wave was so extended, the pullback should be pretty dramatic as shown.  While it is nice to side step this sort of action if you can see it coming, it is part of the normal expected way of things for a new bull market in commodities (AKA inflation).  Nothing goes straight up or straight down.  Alcoa will still reach $18 within 18 months of my original call IMO.

A break back through the top of the upper channel negates this model completely.  But I give that pretty low odds.  Also, I don't think AA will be falling all by itself.  I think the broader markets will pull back as well and that includes gold and silver and miners.  Time will tell.