[UVXY] update [IBB]

In the previous post on UVXY my primary model (scroll all the way down on that post) was that blue 5 had completed.  That suggested the likelihood of a rally and if so then the level of the prior 4th would be a good initial target.  Today the DJIA gapped down hard but the peak % gain on UVXY was lower than expected and right now in the extended trade it is only up 4.4% on the day.  There are many possibilities as to what comes next.  It could be that these waves are the early stages of big wave 3 up.  But it could also be working on E of 4.

The model below shows what I mean.  If the peak of mid December was black 1 then we should be due for a 3 wave retracement into black 2.  In fact, we got something like that into late December but then the rise into mid January was 3, not 5 waves.

So I believe that we could be seeing a so called expanded flat play out here and 2nd waves are a good candidate for this because they are so full of whipsaw and misdirection.  The count of the expanded flat is not 5-3-5 like a normal correction but 3-3-5.  If this is the case then we are currently working on 4 of red C of black 2.

If this model is correct then I would expect a bit more upside for UVXY tomorrow AM, perhaps to ~$26 before stalling and falling back down to $22-ish.  Under no circumstances should it fall below $20 or I have no idea what the count is and I don't hold a stock if I don't have a valid count to justify my position.

I'm holding a full position overnight in anticipation of a dollar pop tomorrow AM.  If it goes to $26 and then falls below $25.70 that is the sell signal with initial target of $22.   If that happens then I will be a leveraged buyer again because I would expect explosive moves upward from there. 

Of course, it might not move up at the open so my stops are set for $24.85.

Finally, we could also move up way past where E of 4 makes sense and if that is the case then let your profits run.  The initial elements of fear are entering the market now.   Mighty Microsoft gapped down and stayed down all day to close -9%.   In other words, 35-40 billion USD of fake, illusory market cap vanished back into the ether from whence it came before it was conjured into existence by the scam of debt based trading (margin dominated share ownership).   That is a big shock but it should not be a surprise.  The world economic system is literally burning down around us and so multinationals who get revenues from Euroland and other recession and depression areas are going to get hit hard.

We haven't seen fear yet folks but no doubt it is coming.  When IBB is in freefall (likely peaks within the red rectangle) then fear will be confirmed.  Not yet but soon, very soon.  Days not weeks.