Sunday, March 15, 2015

Crunch time for [RUSL]

In the backlink I provided this model:

That looks pretty close to what actually happened.  So now the chart has to decide whether it is going to break down that lower rail per the blue model and wipe out into red 5 OR if it is now going to skyrocket upward as shown by the red model.  If it weren't for CWT (Captain's Wedge Theory) I would mos def pick the blue path as primary.  But because it looks like a falling wedge AND because the recent bounce was no where near the level of the prior 4th or the 38.2, I'm going to lean toward the red path being primary model.  Of course, a break below the lower rail of the falling wedge can happen for a short time (maybe to $17.50) and just count as a throw under if it fairly quickly breaks back into the wedge channel and then out the top.  But if that is going to happen then it should be a short lived headfake down (1 day tops) else I would get nervous on the red model.

I will also say that my views that gold and silver and miners and oil are near a significant bounce also plays into this choice.  But again, I do not advocate buy and hold blindly.  I have a model for each ticker, it is a thesis, nothing more.  It could turn out to be wrong so use intelligently placed stops always.  If the model is correct, they will not trip.  If the model is wrong, you lose very little and you get more info to process.

In any case, keep an eye on RUSL, it could turn into a real screamer over the next 3-4 weeks.

No comments:

Twitter Delicious Facebook Digg Stumbleupon Favorites More