[ADI] update

In light of the price collapse on Micron (MU) shares reported on in this post, I think its time for an ADI update.  You see, Micron is the poster child for boom and bust in tech.  It is a canary in the tech coal mine and its recent collapse strongly suggests to students of herding behavior that a tech burn is about to occur.

In my first post on ADI I made a topping call on the shares and expected them to begin selling off strongly into Q3.  Shares were priced at $68.28 back then.  Below is today's chart which shows that a small double top has been put in and the shares have pulled back to $65.78.

Another way of viewing this chart is as a slightly expanding wedge with a series of a-b-c waves making up each of the legs per below.  In this model it is easy to see that wave 5 is now roughly the size of wave 1 and that wave 5 is actually a WC wave as identified and documented in these pages some quarters ago as "Captain's Wedge Theory" or CWT.

I think a relatively safe bet would be the 2017 $40 puts:

40.00

ADI170120P00040000

1.10

0.90

1.25