Metals and miners are doing every headfake in the book.

I've written many times that near major turning points the charts tend to get tricky.  The count becomes convoluted so that most people who look at it casually will get it wrong.  Either that or traders will get whipsawed so many times that they will get frustrated and give up.  Never have I seen this dynamic more in play than in the metals sector.  Metals and miners don't know if they should perish or party.  This is especially true for the junior miners right now.

Why is is like this?  Clearly in order to stop the maximum number of people from getting in at the real bottom.  Face it, not everyone can win.  The stock market doesn't generate any new wealth, it just transfers it between the gamblers (won't the boomers be pissed when they figure this out as they go for their retirement savings and find that the numbers in their accounts evaporate as soon as they go to get the cash because it was never really there in this Ponzi scheme in the first place).  So, by definition the price action MUST work in such a way that most people are confused or made weary from it, etc.  If it didn't work like this then you would have over unity: more value would be extracted from the Ponzi than was put into it by the participants.  This is not possible.  When the herd sees too many crocs lined up underneath the water next to the bank, it moves to another location.  It really does work exactly like that.

The crazy market action is so strange that I am not trying to look too long term.  All I have to do is identify the current pattern and then stay on the right side of it or get stopped out if I'm wrong.  Below is the big picture of GDXJ, the junior miner's ETF.  As you can see, I think we are somewhere in the final wave down for metals.  It's possible that the blue count below is correct.  It's also possible that blue 3 down there is really the 5th wave of the whole metals bear and that what I have labeled as blue 4 is really wave 1 up of the new metals bull.

This is what I am trying to figure out right now.  The difficulty lies in that the wave into blue 4 counts suspiciously like a 3 wave move, not a 5 wave move.  It it could also be a 5 wave move!  The chart is being a bit tricky so its hard to be sure.

If I model this as a 1-2 having played out, there are lots of things to like about that model.  The chart found support at the center line of the downward sloping triangle and it also kissed the 61.8 fib nearly exactly.  Still, that bounce into what should be 1 of 3 does not look very 3rd wavish!  Is looks corrective, not impulsive.  So that wave leading to center line from top resistance could in fact be A of 5 down and then the recent bounce would be B of 5.  That wave is certainly a triangle and triangles are penultimate.  So this is either a B or a 4th and that is what is perplexing me right now.  While the wave size can give hints as to its degree, size is subordinate to the wave count always.  In fact, "fake B waves" which is how I am currently modeling this, is how we end up with fishtail formations that mark a change in direction.  You might also see it as a variation of The Owl but they look quite different.  Fish tails are filled in with lots of ups and downs like this (corrective looking moves).  Owls are made up of motive looking waves.

Here is the close up of just the triangle as well as the first wave down from the 5th wave peak of the triangle.

So, per above, my primary count says that this triangle is really a big over sized red herring designed to make people think that it is a large B wave leading to 5 more big waves down into a C wave throwunder of the green support line in the 120 minute chart above.  Of course, that might be exactly what it is so I'm not making any "do or die" assumptions.  I'm playing it wave by wave and I'm using stops.  But the thing that would throw the max number of people off IMO would be to treat this as a 4th wave and not a B wave.  For now I'm going with that.  If at any time the chart reverses and takes out the upper resistance line of the triangle then that would be a first confirmation that it's all over for the metals and miners shorts. 

I'm going to love watching this.  Yellen knows that metals are part of the Fed's "herd management" (crowd control psyops) program. When metals get out of hand to the upside, they wail loud and long that the dollar is a fraud.   They are in fact the only things on this planet that can credibly and without argument do so.  At the same time, without more stimulus you can just watch the Ponzi markets dissolve back into the ether from whence they came.  Yellen cannot have it both ways!  Bernanke was a slick customer, a real world class con man.  The market clearly respected him for his scammy skills.  But bat-faced Yellen?  Not so much I think.  She's going to be the disposable fed IMO even though all of the damage that will soon come to light was already done under Greenspan and Bernanke.  Won't it be interested if things collapse and then everyone pins Yellen down and wants a pound of flesh.  At only 5.3" tall it would not take many of those flesh removal sessions to have nothing left.  Will Yellen take one for the con men when she is being attacked for the collapse or will she roll over on the Feb, on Ben, or Greeny and of course on Obama?  If the choice ends up being prison or singing, she'll sing.  That is how all organized crime families end up collapsing.