At the same time, I cautioned strongly that just because that model had looked good to date that we should not blindly count on it. I wrote,
"Just because this wave played out exactly per the model, that does not mean the rest of the model MUST play out. EW is about odds and not about certainties. But long time readers have certainly seen by now how accurate EW can be and how powerful it is even if the model is wrong simply because you know very quickly it is wrong. For example, I called a peak at green C. That means sell. Now I model a support point here, that means potential buy. But it also means if this breaks below the lower rail then it becomes a sell again. So you can just set stop loss at 50 cents below the lower rail and come back in a week to see if you got stopped out or if it's headed back up to $52."
As you can see from the updated snapshot below, that was wise advice as the shares eventually could not hold the lower rail, broke down, then back tested from below before plunging to new lows.
I continue to believe that social media stocks are a fad, most of them are essentially worthless Ponzi schemes based on liberal hopes that these stocks represent a new era of value generation. The current valuation of Facebook still says the herd has hopes for a new economy to form around such blatantly uneconomic things. What a joke. Oil is worthless and useless Facebook is nearly 300bn market cap with a trailing PE of 104 and a forward fantasy PE of 36. Man have the priorities of this economy been turned on their heads or what?
Trust me when I tell you that this insanity cannot last forever. If you want to go short, short these liberal social media stocks. But if you don't like shorting, metals, miners and energy will soon shake off their great depression funk and the gains will be astounding because they are oversold to an historic degree right now. The conservative swing will collapse the fakeCONomy stocks soon and then real shit like energy will suddenly matter again.
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