As skluck would have it, the model held and today's DJIA loss was likely 1 of 3 of 5. We have not had much panic during this wave yet, but it's coming. The herd has to pick up a full head of steam going south because the wolves are on its tail and the herd is already planning a sudden reversal somewhere below 15300. I would suspect 15k or just slightly below but it will only be over when 5 waves are done. With this quick whipsaw they are going to try to lose a bunch of the shorts. Nose down and throttle up in order to try to blow the engine fire out.
I for one will be expecting it and I will dump UVXY when I see 5 waves down here and then fall madly in love with the M+M again. Note, I did not attempt to be wave accurate below (wave red 3 will be 5 waves and not 3 per below). I was mainly trying to show that red 3 is expected to end some place close to blue 3 so that the market can have false hope of a double bottom only to have the bottom drop out to create a lower low and to officially terminal intermediate degree wave 1 down (i.e. everything from the 2015 top to the coming bottom).
Zooming out and applying Andrew's pitchfork analysis, I see an expanding falling wedge which I think will likely terminate mid channel We'll have a good idea that this is going to be the case if it finds wave 3 support on the center tine.
But if something crazy happens like a gap down below center tine then there is nothing stopping it from crashing all the way to the bottom. Such a crash could hit DJIA 12k by the first week of October. As shown in blue below. It would be a collapse for the record books but to be honest, I do believe that some records are going to be set in this collapse because the leveraged longs (and not the shorts) have pumped this crap the blood moon and now it is going to return to Earth.
Blue above not my primary model. My primary is a more orderly breakdown as shown in red above. But tracking herd movements is about odds and not certainties. Additionally, there is nothing, and I mean not a damned thing, between where the DJIA sits right now and DJIA 12k except confidence in the con game and if that goes for whatever reason then assume nothing is impossible because, folks, stocks that pay no divvy have an intrinsic value of ZERO. When the margin calls come, and they will come, they will arrive with a vengeance. Oh, the selling. Oh, the Marks and Patsies finally figuring out what their 401ks are really worth. Also, we are now in a massive C wave of a monster expanded flat correction that actually began in 2008. C waves do not tend to dally. They assert themselves. Do not mistake blue C above with that. Blue C, should it occur, is just C of 5 of 1.
If I asked anyone else in the world what the blue chart odds were, they would say "zero percent or nearly so". But I give it a full 10% chance and if a wave in the coming days gaps down below Andrew's middle tine, that goes up to 25% chance instantly.
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