We a dobble peak and a possible complex 5 wave ascending wedge pattern, coming up from the bottom. On this chart I have also added in time analysis with the actual days a move took to complete before reversing, within the bigger structure. As you can see, we started with a couple of 3 month moves, which have reduced to 30 day moves. This could easily be reduced to 2 week move until we finally see another 3 month move or longer.
I have drawn out several arrows as to how this could all play out. Usually and ascending pattern from the bottom is a corrective pattern which results to a move back down. Thus, the initial bias should start out being lower. Again based on the structure alone. Now will this pattern have 3 or 5 waves? I don’t know, no one does.
If it is a 3 wave move completion and continuation, we should break out from here and keep going higher. That would mean the 3 month move clock has already started. If it is a 3 wave move correction, it is very possible we break down below point 4 and at the very least, test previous lows. Again the clock has already started.
If it is a 5 wave move, than we should hit point 4 bounce and push up to wave 5, before continuing higher or collapsing at some point in 2017 again on a 3 month move lower or more.
As I have done in the past, I will focus on a certain key component for a while to drive the point home. This is very advanced analysis and not your typical draw a line here if it breaks sell or buy blah! blah! which never works. If it did we would all be millionaires! Nor am I telling you what I am teaching you here is the holy grail of analysis and you will all be millionaires. Hardly! But I can promise you that it will greatly reduce your loses and give you a slightly better edge.
Author Jim Boukis