[DJIA] update [UVXY]

Back from Shanghai late Friday evening getting a chance to look at what has happened in the markets last week where I literally had no time to review things.

In the backlink I provided the model below.

As usual, I look at how things progress in reality and then try to make real time assessments on whether the model is still likely or not.  This approach tends to work very well for me because I never believe my own bullshit to the point of data blindness. 

These charts are odds based models and nothing more.  When reality follows a model for a while It is very, very easy to get lazy and to believe that they are somehow a crystal ball.  The herd is dynamic and models can change.  If this sounds like no better a odds management strategy than random chance or gut feel, consider this:  I often don't wait until something bad has happened to the mode before I begin to question it.

Take the current situation of the DJIA.   Above is the prior model, below is the current chart.  The DJIA has lost 800 points since that last post.  HOWEVER, the chart did not take on the exact character that I was expecting and so now I am open to the growing chance that that what we are instead seeing is a 4th wave HT form here.



There are several reasons I'm starting to suspect this but the main ones are:
- After W3 we did not get a clear 5 waves up.  I'm starting to think that it might have been a-b and c of green a or red HT4. 
- UVXY is no where near a new high like I anticipated it should be at this point.  In fact, it looks like a rising wedge which broke out the 5th wave and then busted back into the channel and then back tested the upper rail from below.  If I weren't so heavily long on metals and oil services, I would consider a short sale here of UVXY because the stop loss level is so clearly defined.  This model should not allow UVXY to break above the top rail here.
- The recent action on the DJIA looks like a unicorn tail AKA near term capitulation.




I also note that the economy is still not doing badly.  There is not the mass unemployment and civil unrest that I think should be building at this point for us to really be in the 3rd of 3rd down.  This is not a EW component but it is something that I keep in mind.

In any case, My prior model is far from bust yet.  I'm simply pointing out that there is growing evidence that it might not pan out.  So if you have been shorting everything in sight without using stops, now would be a great time to reconsider that.

Now, if the chart goes below green "a" of the HT model then the HT model is bust.  But if we get a strong bounce here and if it happens in 3 waves to kiss the upper rail from below then the odds really go up that the HT model is playing out.

Some might consider this to be flip flopping on a "view".  To those people, let me be clear, the only "view" I have is my interpretation of the EW count and each time I get new data I am certainly reviewing current models.  Failure to do this is failure to understand the nature of Elliott waves.  Also, warning people of increasing odds of a model change is not being done after they have already lost money following my model.  I'm using EW to think about the future possibilities, not make up for water under the bridge.  Huge difference from what someone like Jim Cramer does, for sure.