The actual chart is shown below with Andrew's pitchfork overlaid on it. You can see that the chart decided not to go directly into the 3rd wave down, instead it extended the the wave 3 count by inserting a perfectly legal green wave in there and so it was a 3rd of 3rd of 3rd and thus the gap was even larger than I originally modeled for the 3rd of 3rd scenario. This is a situation where the longer you wait to let the pressure blow off, the more sudden and dramatic it is going to be. Microsoft is officially in a bear market right now, having plummeted 20% from its highs already. While I do expect a counter trend rally here, the shares should turn back down within a week if this model is correct. In the case, the lower rail will be taken out while the rest of green 5 plays out (which is still part of blue 3). That lower rail will need the power of a 3rd to break down.
The big picture is below with current model in blue and threat model in red and pink. The red/pink model adjusts the count so that the recent high was not the 5th of 5 but rather only the 5th of 3. Indeed, a case for W3 could be made into pink 3 although it has a slightly strange shape compared to what I have been seeing for verified W3s of late.
Either way I think MSFT finds support at the lower rail so if you are short the shares based on my EW models then, it's likely time to lock in profits here and then we wait to see if the coming bounce is a small a-b-c per the blue model or a fast and furious 5th as per the red model. Either of these outcomes would be totally legal under the EW rules so the key is to look for triggers. If we get a small a-b-c and then a break below the rail then a rapid share price collapse will be, by far, the best odds outcome. Otherwise the real start of the crash will be delayed to Q3, perhaps to align with the 2015 Shemitah.
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