[$COMPX] update

The DJIA and S+P and especially NYSE composite are sucking wind while the $COMPX and $NDX.X are moving up at a measured but nearly relentless pace.  The rally is stretched but it might extend to that overhead resistance before relenting.  This isn't over until $COMPX says it's over.

$COMPX is very nearly up against the upper rail pointed out in the backlink.   That top rail will not likely just be sneaked across/waltzed across lightly at this point - it's too near the psych barrier of 5k.  So one of three things will likely happen which I present in prioritized order that that I think likely to occur:

• a smallish pullback into pink 4 and then take out the upper rail in 3 of 5 of C with a strained throw over before coming back down into the channel
• a deeper pullback and then  5 of C just kisses the upper rail from below but cannot overcome both the top rail and the 5k psych barrier.
• today was the top and the sell off begins tomorrow quickly accelerating below the lower rail of the big wedge.

I just do not see a slow migration above that top rail and 5k as being high odds.  I see it requiring the power of a 3rd and to be honest I would be surprised to see even a 3rd of small 5th do it and hold it for more than a day or two.  Something this big really should need a 3rd of a 3rd OR the 3rd of a larger degree 5th and with all of the overlapping waves since Aug there is little chance that we are in 3rd of 3rd territory.

The further this creeps up without a significant pullback, the more likely that the next pullback begins the selling stampede.  If you never let the earthquake release pressure then when it finally does break free it will be a doozy.

The other model that I am looking at is below.  In this model we are very near the top of black 3 and when it lets go into black 4 it should do so suddenly and rapidly because black 2 was sideways.  Such a move would be very, very trade-able with UVXY!  It reverse at the lower rail or it could pull all the way back to find support at the 38.2, thus breaking down the lower rail for a short period of time before moving back up into the end of the year.  But the run from 2011 has been so powerful and bullish sentiment is so one sided at this point that there is no way it is going to power higher without some kind of powerful and shocking pullback. 

So here is some charting wisdom:  If this just rolls over slowly and then begins to meander lower nonchalantly, that is a bull trap intended to get buy the dippers to come on board.  If that happens then EWI might be right and a much much bigger sell off is ahead.

But, and I think this the far more likely outcome, is that we get a vee top, sudden reversal and then see some panic set in into wave 4.  If that were the case then  it will likely bottom at the 38.2 fib which right now is around 4k.  After that, a final high into the end of the year with the 5k level being taken out by 3 of 5 of that wave.  The top in this case would be 5500.