FAZ update

I think tomorrow FAZ (triple short the financial services) will tip downwards at the open, go down a very little in order to hit the 61.8% retracement and then turn back up strongly.

Whether or not the overall bull market has expired should have no bearing on this move.  Stocks were up strongly for month after month and sometimes they have to take a rest.  We got one big wave down which was a 5 wave motive move below (FAZ is up when the markets are down).  Now I see an A-B-C retracement that is likely almost all played out.  At the very least we should get 5 more waves up, this time even stronger than the first time.  That should be true even if the markets are just doing an a-b-c retracement (leading to a 1-2-3 upward movement by FAZ, TVIX, etc.).

Here is the lower level model of the A-B-C retracement.  C is the most powerful wave (by far this time).  Notice the alternation between blue 2 and blue 4.  This is textbook Elliott.  The assumption is that one more tiny wave must transpire (perhaps 15 cents more to the downside) in order to make wave 1/C the same length as 5/C and also to kiss the 61.8 fib.  Once those things happen, trading computers should begin shorting the markets again.  I model that tomorrow will end solidly to the downside for the broader markets.