Friday, March 13, 2015

[JNUG] update - critical juncture

The model from the backlink was decidedly bearish as it was expecting a crash from $20 down to $15.  As it turned out, the crash went all the way down to $13.  So now we are at a cross roads.  The here will either have to interpret the recent crash as the bottom and then the big bounce as red 1 OR it will treat the collapse into the 11th as a 3rd of 5th, the move to $17 and change to be a 4th (notices it was a rising wedge which suggest a C wave...) which implies a lower low coming.

This will have to out itself soon a move above the green line is a clear breakout and so the conservative speculator will wait until that happens and the pile into this big time.  Conversely, if we get a big moved down from here, count 5 waves along the blue path and then go for it.   Either way it is going to be back up over $20 by the end of next week IMO.  But the volatility down here is where big percentage points are made or lost so it will pay big time to stay on top of this.

The top level model for the bullish variation is below.

The top level model for the bearish variation is below.  Both are correct under the EW rules.  This is a good example of how the herd has options open to it under the EW principle.  You cannot know in advance exactly what path will be taken from feeding grounds to breeding grounds.  All that you know is that it must happen and you will know when the point of no return has occurred for making the turn.

While that is a nice double bottom at $13 (a fine Illuminati number as well), the conservative thing to do here is to not lose money!  If the red path is going to happen then you will know it is playing out by a higher high than $17.50.  If the blue path is to be taken then the bottom should begin falling out very soon.  But keep in mind that the blue path eventually leads to much higher highs so if you see blue, begin to get bold when others are screaming "WHEN WILL THIS PAIN END!!!!"

Buy when there is blood in the streets from others who are investing on gut feel, have no structured sell triggers and will thus succumb to their herding instincts and panic sell only to realize they were shaken out at the bottom.  Then the shares will reverse upwards and they will buy back in at a panic as well so I expect the bottom to be short lived on this one.

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