Nothing much has changed since I posted that linear scale model so today I want to update this chart using log scale which is what you see below. The salient features of this model are
- Nice red W3
- Nice green w3 which gives way a-b-c to green 4
- 5 clear waves down from green 4 to green 5 (even though I would have liked to see this a bit longer)
If this were in fact a falling wedge per above instead of just being a normal parallel channel motive move then I would probably be giving the higher odds to the blue path. But I'm not. I'm assigning much higher odds to red. Think about why I might do that from the model below and then scroll down and get my take on it.
Did you figure out why I'm voting the way I am? There is one main reason. It is not definitive but it is important and that is that green 4 did not overlap into the range of green 1. Had it done so I would have been calling it a falling wedge for sure. It might still turn out to be a falling wedge and the first clue that this is going blue on us will be a break ban down below the top rail of what could easily turn into an horizontal triangle where red and blue diverge. Higher than cyan 4 and the odds go up dramatically that the bottom is in.
Folks I know this sounds a little crazy but my price target from here is defined by the EW principle to be the level of the prior 4th. That would be red 4 in this diagram which is around $240. You do the percentage math. It will not go straight up there. It will try to lose as many gamblers as possible along the way and it might form a weakish A, then B and then strong/exponential C to get there.
Nobody knows the future for sure but I want to be on record saying that the bottom is likely in already on this but that I think stops (as defined above) should still be used at this point because nothing is confirmed yet.
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