While the stock headed all the way down to $8 in a capitulative bottom, the chart sentiment remains unchanged. I've updated the count slightly below to better account for the deep final swoon. In this new primary count, July 2014 was the high of wave 1 up and everything since then was a massive expanded flat into a deep vee wave 2 down. So in other words, this extra hard landing has reduced the likelihood that the red path above will play out and so blue above is now primary and as such its path is now red below.
For what it's worth, I did see this large of a pullback as being possible all the way back in February of 2014. The model from that post is reproduced below. The reasoning was that I could count the wave such that the prior 4th was in the $8.70 to $8.80 range. In any case, this business of predicting the future based on past events is all probability based. The best you can hope for is to rule out 99.999 percent of of the possible outcomes not because they are impossible but simply because their probability falls off at an exponential rate. This leaves you with a few likely paths going forward and, most beneficially, the near immediate knowledge of when the model has gone bust so that you can exit your bet before the losses are very high.
In this way you let your winners run and cut your losses short. I don't care what anyone says, decades of doing this have taught me that this is the best you can hope for and the best you will ever receive.
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