Fast forward to today and we can see that I did get the peak right but that we had a deep vee 2nd wave (not unexpected if you read these pages very often). Then 5 down into blue 1 and now 3 up into blue 2.
Zooming into blue 2 above, we can see why there is no panic in the market as of now. Everyone and their dog is modeling a 3 wave pullback having just happened which was nothing but a gap fill which opens the door now to higher highs. But this thinking would discount the 5 clear waves down into blue 1 and so blue is not my top model below. Red is. Time will tell. If red plays out then the real panic will occur when the red model above breaks down the top rail and ends up back in the channel. That would be a clear and unmistakeable sell signal.
The blue model becomes interesting again if the chart can break above the level of blue A. That's because if we are working on wave 4 then it should not go back up into the region of 1 (which is how A would be renumbered for the red model).
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