[IBB] update

In the backlink I provided this model:





This ETF decided to take the 5 prime route.  I missed the peak call this time by about $20 to high but I clear understood that we were on thin ice here.

Note to newcomers: This is not the first time my models had indicated that a possible peak was in.  For example, review this post.  Newcomers might be looking at some of these calls which have been so incredibly accurate of late and thinking it's always so easy.  Well, no, it's not.  HOWEVER this is not to be mistaken with "making multiple wild guesses" or gambling based on emotions.  In all cases I know very, very quickly when a model has gone bad.  Then I step back and get more data to reassess.  I do NOT hold onto the shares thinking that they will come back my way, etc.  No no no!  That is not the wave trader way!  Since we know the odds on a given turn based on the wave count, we pick entry points such that if the model fails, the losses will be small.  I liken it to that guy that nobody wants to play penny ante poker with.  He gets a hand and if it's not 3 of a kind out the gate he just folds.  When he has a full boat aces over kings then he plays and he bets big.  In poker when you lose, you lose the whole bet.  In my kind of EW trading, when the chart crosses the failed model trigger you stop out for a few per cent as long as you bought in just above the fail trigger.

This is the real key to making bank trading the waves.  Everything else is sort of entertaining but it's picking the right entry point (and associated stop loss) based on the odds given to you by the wave count that makes you money.

In any case, this is now in 4 of 1 down according to my model.  According to this model wave 1 down will probably hit the lower rail as shown.  Then there could be a very large vee bounce into wave 2 but then wave 3 will come crashing over the rails and remind everyone that stocks actually have zero intrinsic value.  They are just another fiat currency.  This is especially true when no divvy is paid (or some crappy little 3% divvy that in no way compensates you for the kind of down side risk that we now face).

One more thing.  In the "review this post" link given above, I clearly called out IBB as a stock to watch regarding mood of the herd.  The herd, I stated, could not be thought to be truly scared until IBB broke down.

Well, IBB broke down folks.  This cannot be fixed by a couple days of rallying on the big board.  This is broken.  Wrap your head around it.  This kind of sustained swoon per unit time is just not where millions of boomers can afford to be!  They are scrambling right now to do what they can to reduce risk and that is going to cause the 401k fund managers to have to deleverage as well.    This is exactly why I exited the 401k system long ago.  I realized that the penalty I had to pay on top of lump sum taxes was STILL going to be a better deal for me than to have my life savings tied up in a government controlled account.  The time, I think, draws near to when we will begin to see capital controls in the US. 

When you see laws being made that close escape paths to the paper money debt Ponzi then rest assured that the trap has been sprung.  Someone has to pay for all this and boomers have the ability to pay.  That is all that is going to matter when the bill comes due.  I don't give advice because you don't pay me to but if I did it would simply be to GTFO of this value trap know as government sponsored (AKA controlled) retirement investment program.  In fact, that's what they should name the whole thing: Government RIP.