Today we got a unicorn horn moved to exactly $10. So it is very possible that blue 4 is done and that we will now head down into blue 5. But I must admit that the 3 wave move is unsatisfying either in terms of price movement or of time movement given that it is supposed to retrace the entire blue 3 wave. You would think that a wave which took nearly 11 weeks to play out would take more than 1 week to retrace. Additionally, it would be more satisfying to see the retracement come closer to the level of the prior 4th or closer to the 38.2 fib.
So while I am not convinced that the retracement is complete, I decided to bail on my ARP for a 17% gain on the day as well as my UGAZ for a 9% gain. I just want to see what tomorrow brings. If I see a pull back to the lower blue rail as shown below then I will be tempted to get back it as this will have provided a kiss of that rail from below which fell back and then broken into the channel and then a backtest of that same line, which is now support, from above. Such action would make me believe that there was still significant upside left in this 4th wave bounce. If however, this thing punches through the lower rail again tomorrow AM then we could be in for a capitulation sell off into early February.
Having said that, when this wave is completed I am expecting a big bounce where USO heads back up toward $20 and things like ARP, GLNCY, VNR and the like make serious percentage gains.
No comments:
Post a Comment