Before discussing the model below I have to remind readers that these are just models. The fed has models. Economists have models. Structural engineers and civil engineers have models. Models are not perfect and anyone hoping that they will be able to regularly catch the exact bottom is really kidding themselves. SOMETIMES I will nail the exact bottom to the penny. But sometimes I will be off by 50%. The difference between winning and losing here is the use of stops. Trying to catch the exact bottom is sport, not investing.
I saw a potential ORIG bottom at 92 cents on Monday. I know we are near a significant bottom and I know how fast these things can reverse and I do not have time to watch in real time because I have a day job. So the play for me was to take the chance but to bow out easily unless everything went exactly as I wanted it to go. I was subsequently stopped out at 91 cents. Now its 77 cents. You do the percentage math. If you take the chance to win while limiting your losses, you will win over time. It takes discipline and few people make themselves do it religiously but that is what it takes to win, especially in a ridiculously volatile environment like we are seeing right now.
So today we made another step in the expected direction. The bottom could have been put in today but I would expect blue 5 to be the length of blue 1. Blue 1 is 5 or 5.5 units, so that is what we should expect from blue 5.
So we could end up with a unicorn tail down into the $0.66 range in the AM trading tomorrow in order to complete the wave. I would see that as an aggressive buying opportunity for two reasons:1: the chart would match the model nicely.
2: you know exactly where your stop goes when dealing with a unicorn tail. It goes 1 penny below the inverted spike.
I bought a half position today and if this gaps down I will get taken out tomorrow AM but then I will be sitting there with a full position waiting for the unicorn tail to bottom and then buy back in big.
I want to say that this wave since late December could be counted several ways and it got the count that it did mainly because of the GOE in the red 4 position. I'm still formulating GOE theory but it seems to be associated with penultimate waves which means 4 or B.
I also bought FCX with stops below 4.75, DSX with stops at 2.05, RUSL with stops at 7.40, JNUG with stops at 41.40, ARP with stops at .56 and finally LL with stops at 11.60.
2 comments:
Captain...can you provide analysis on TSLA...even though it could be bloated, just curious...
Thx
S
I count the wave which played out in 2h 2014 as 1, now working on C of 2. Most of 2015 was just a big HT. This is significant evidence that the current selling is a C wave unfolding, and probably done with 3 of C at this point. In other words, this looks to me like a big retracement, not a complete collapse. It implies Avi as opposed to Prechter. And if Avi is right about the stock market then he will be right about gold as well. So what the heck are you doing with TSLA? M+M is the current play and commodities will bottom very soon ; )
In any case, level of prior 4th is $115. The chart is already lower than the 50 fib so I assume 61.8 fib is the target ($120). TSLA is not going worthless. Electric cars are out of vogue because oil has crashed. But oil will bottom soon and then we are going to have to pay up because the survivors of this collapse will be able to charge whatever they want due to collapsed production. Banks will not be able to lend into oil again like they did before. They will "learn" their lesson, again. So we should not expect a bunch of new capacity funding to happen. Banks will find another kan't miss sector to oversupply with cash. It might even be electric cars and battery tech this time...
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