What I would like to see and what I am going to see may not align, but this is what I would like to see. If this $%&*! minute (blue) 4 is finally done, we should exit the range to the upside in a 5-wave pattern (the little red count you see on the chart).
If that happens, I think several things of great importance will occur up there.
- Many bulls (who also interpret this as a 4) will see that as the 5 (as opposed to my orange 1 of that 5—as I expect an extended 5th). Many will expect a deeper retracement from that point.
- Every bear out there will also aim to short the big orange box because it’s the logical place to do so.
To my mind, this sets up a perfect storm: bulls won’t be long and bears will be short, en masse, and I think that’s a good spot for the exact opposite to happen: a move in a 3rd of 3rd to upside instead (after the orange 2 up there completes).
That said, we’ve got to get out of this range. If we don’t, it’s possible that the blue 4 isn’t done yet and they’re just going to keep us here even longer. I hope they don’t because I’m bored, but it’s become a very large structure and it can get bigger.
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