This is becoming very interesting. From yesterday update: “I am expecting wave (i) to complete around 19600-19700, then a retrace for wave (ii), possibly shallow, to 19000, and then wave (iii) of 5. Overall target for wave 5 is the same – 22-24k in a couple of months.”
Today so far: – wave (i) completed at 19534 – wave (ii) completed at 19142, precisely 0.236 retrace. – wave (iii) of 5 is underway unless I am deeply mistaken.
Next targets: – wave (iii) – 22146, 1.618 of wave (i) – wave (iii) timing – 2nd week of January – wave (iv) – a sharp drop – wave (v) of 5 – 23400 – 24000 – wave (v) timing – second half of Feb – first half of March.
In the last update on November 23 I mentioned that GDX would confirm a multi-month further decline if the monthly candle closes below 35.52. Well, it did and completed a very strong bearish build-up on the monthly scale – Spinning Top, Harami Cross, Three Black Crows and Tower Top. Honestly, I don’t know what kind of miracle needs to happen, so that the odds are immediately back to the bullish side.
I believe that GDX has started wave iii of 3 of the major decline in wave C. The proposed wave structure is supported by technical indicators and candles combinations on various time frames. Targets: 1. The top of wave iii is projected by red fibs, 1.618 of wave i, approximately $22-23. Timing by channel – in the next 3-4 weeks. 2. The top of wave 3 is projected by green fibs, 2.414 of wave 1 started in August, approximately $18-20. Timing – the first half of February 2021. 3. The top of wave C – 3 fibs of both green and red, approximately $11-13. Timing – end of March – beginning of May. On the Mid Term chart I have adjusted a channel as wave ii completed. Note that on my Very Long Term chart I did not move a single graphical element since the previous update. We will see how it plays and I hope it helps.
BTC seems to be chugging along well, as prescribed. Today it completed a triangle for wave iv of (i) of 5, as shown on the short term chart. I am expecting wave (i) to complete around 19600-19700, then a retrace for wave (ii), possibly shallow, to 19000, and then wave (iii) of 5. Overall target for wave 5 is the same – 22-24k in a couple of months.
Today’s RTH closure printed the decisive combos for all major Indices. Let me interpret them in details: 1. DJI and SPX cash completed the Bearish Engulfing combos that stopped short from totally embracing the previous day candles. Note that the price is at the level of PSAR and any movement further down would flip PSAR to the dark side. 2. SmallCap cash printed a very strong Dark Cloud and it would take a lot for the bulls to overcome its shadow tomorrow. 3. NDX cash completed a Hammer that could be also viewed as a Harami to the last red candle. Most importantly, the candle closed below the mid point of the red candle. We will know tomorrow whether NQ was the last line of bull’s defense before the start of real downtrend.
Today’s advance reversed almost precisely at the level where wave 1 off the March low would be equal wave 5. I’ve been talking about these counts and the possible reversal point for a while. If the count is correct, I can see two possible options for completing this diagonal. First, the diagonal has already complete with a truncated wave 5. Second, the wave 5 can complete one more wave up. Based on the candle structure and several technical indicators, I favor the first option.
There are 2.5 hours before the close, but there are some interesting observations can be made in the candles world. 1. SPX, DJI, and NDX seem to be consolidating at the bottom of that large red candle made on Thursday. The price needs to stay below the mid-point of these candles to keep the bearish pressure. 2. NDX looks like still holding the fort. – If NQ closes above ~12510, there is a chance for bullish continuation. – If below, the bearish consolidation solidifies. 3. DJI seems to be leading the pack to the downside. 4. SmallCap could complete a Bearish Hammer or even an Engulfing.