If, on May 28th, Nasdaq Composite closes below 13407.36, expect a multi-month correction. Targets: 11000-9200 (-22-35%). Worst case – 6600 (-53%). Mark this post.
Previously I posted May 31st, but as this day is a holiday, the monthly candle is expected to form on Friday, May 28th.
The closure below 13407.36 will complete a Bearish Engulfing on the monthly scale. These candles are usually followed by a multi-period correction. Odds – 80+%.
Nasdaq candles have been warning about a possible reversal for several months (see links to the posts below). Perhaps it’s time. The monthly chart suggests that it could lose 22% of its value, worst case – 53%. If you don’t believe, look at the monthly MACD and compare to year 2000.
From the candles perspective, in order to avoid a bearish monthly closure in May, Nasdaq Composite needs to close above ~14210. Everything lower will be considered bearish with various odds. As I type, NQ is 13738. So, technically, it needs to make 3.4% or more in the next two sessions on Thursday and Friday. Is it possible? – Probably.
Is it probable? – We will see.
In my projection, I used the same methodology that allowed me to forecast the drop in #Bitcoin to ~29000 in March 2021 (a few weeks before it started) and a multi-month bear market for #XAUUSD in the middle of August 2020.
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