[DJIA] update

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DJIA dipped below an important support line briefly today and then recovered into the close to end flat.  This is not what I would call an intraday reversal.  It's what I could call a frog touching an electric wire which gets his attention.  Still, for now, enough attention was gained in order to bring the DJIA back above support.  So at this point we are in a bit of no man's land.  The entire move since mid May can now be counted as a falling wedge and this is no 3rd wave.  So it could likely be an a-b-c pullback to the level of the prior 4th.

That is one interpretation.  The other is that this is a leading diagonal which was wave 1 down.  Wave 1 had just enough energy to dip a toe below support but that's it.  In this scenario it needs to build wave 2.  The bounce so far has only come to to about half of the usual 38.2 fib level so we should not be surprised to see more but at the same time it could be a more complex wave structure designed to confuse everyone given how major a juncture this could turn out to be.  After all, some are now declaring that a death cross is in place.  To be honest, these crosses come and go and I do not consider them to be any more reliable than old sayings like "Walk away in May".  But the action is just so choppy right now that it is difficult to pull a solid count out of it.

Where solidity will be seen, should it occur, is if this was really wave 1 down and now working on wave 2.  Wave 3 would then bust through that lower support line with gusto and lead to a strongly lower low.  If that happens then I expect to see a very clear wave count form in that 3rd wave down.  But until we get more data, the prudent gambler has to wonder if the fear of breaking down will put one more last and final run into the hooked fish.

I think it is important to keep an eye on JNUG at this point.  If JNUG does not begin to pull back strongly tomorrow then I have to begin to wonder if the recent gap fill was more than that, and perhaps quite a bit more.  JNUG really needs to begin falling tomorrow for my recent model to continue to be viewed as correct.  If that model is wrong, is UVXY going to be proven wrong as well?

Odds, people.   Odds and not certainties.  Don't fight ticker and use stops on your trades.