You'll notice in the primary (red) model above that I modeled it as back testing the upper rail from below and then bouncing down to form 1 or A, 2 or B, and 3 or C to perhaps the $6.42 level. I did not draw 5 down here on purpose. The reason is that the herd has several options here. The main ones are that the count above represents a leading diagonal which should retrace to (usually at least) the 38.2 fib. That's what the red path represented: and a-b-c pullback into wave 2 which would fill the gap and back test that down sloping line from above.
The other interpretation would be that this is not going to end up as a rising wizard's sleeve but instead we are seeing 1-2, 1-2 behavior which would mean that FCX is about to disappoint short sellers. In any case below is what actually happened. Yes we got the modeled back test and then yes we got a very rapid decline down to $6.65.
But zooming in we see that the next move up was 5 wimpy waves which were still motive in nature in aggregate. Notice how 4 did not fall back into the range of 1. STILL, this is wimpy looking so I would not hold it overnight. Besides, even if it is going to catch some strength tomorrow, it probably needs to move down at the open to the level of the prior 4th as shown before doing a bullish AM reversal. Bottom line: the odds say don't hold but if this gaps up tomorrow at the open then it will be a very bullish sign and we should consider buying the 3 wave dip. As you can see, my primary model is to dip at the open and then continue to a higher high.
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