Today's update shows that this has not happened yet. Additionally, because of how resistance was broken out of (green arrow) and then consolidated on top of (again, like a man half drowned pulls himself up onto a rock of safety where he can catch is breath and then make the next attempt to climb up out of the valley he has fallen into...), I'm now changing my count to the red as primary but only by the slightest of margins over what was my primary but is now my secondary count in blue below.
I give it 55:45 in favor of red. You will know the odds have swung dramatically toward blue if the chart breaks back down below support. Short term traders can use that to set their stops. But if this happens, be on bottom watch big time because breaking that falling red rail tells me that the herd has begun accumulating. It does not mean that it can't go to a lower low but if it does I will expect it to be a sharp vee bottom, there and gone in a flash.
For newcomers, I want to make sure you understand what the potential upside of Cliff Resources is. We are currently in a commodity great depression. Gold and silver are down big time from their prior peaks and the junior gold miners are down 90% ON AVERAGE from their 2011 peaks. Oil which once peaked at ~150/bbl is now in the 40s. Dr. Copper is in the shitter. Check out the copper mining ETF chart below. Look at the unicorn tail that was used to capitulate below the red trend line. Now the miners are bounced back up to that resistance and have to either break out (red) or put in a double bottom (blue).
Do you think copper will go worthless or that the copper mining industry will be in the tank forever? I don't. I believe that they have had to clean up their operations and their balance sheets over the past 5+ years and now the remaining players are running lean. When prices move back up, and it could happen simply because of dollar devaluation at first in a falling economy (Canada is now officially in recession), this is where the money is going to flow.
Commodities are where the conservative money will run and the herd is turning conservative.
As for the potential of CLF when the turn comes, well, my current model is below. This is selling at literally great depression prices. When commodities make a come back the expected price for this is above $120 and not by a small amount. This is a clear 3 wave a-b-c 5-3-5 retracement from the peak. If my model is correct, 1000 shares bought today for $4k will be worth well over $120k during the next wave up. Don't tell me it can't happen. Green 1 is living proof that it can. And don't tell me that you think the odds are low of it happening because that is just gut feel. I on the other hand have something more tangible: a model which has years of history in which the EW rules were followed very nicely. So the odds strongly lie with my view if you buy into the idea that EW is a real thing. But if you don't buy into that, please explain all the great timing calls which the use of this model has brought me.
Buy the dip folks, and keep an eye out for a double bottom which would be for longs exactly what the double top of red B was for shorts back then.
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