The biggest reason for my appreciation of the trappy bullshit count was the lack of extension in price to justify our having entered a deep 3rd wave, but also in place: that is to say, the extension should have manifested itself probably on Friday.
We’re now getting down to the levels one would expect for the extension seen in a third wave (and if we open around here or lower, we will certainly also break the parallel rails as well), but we have to then figure out what to do with the choppy crap from the end of last week.
And so here are a few thoughts.
It’s possible that the trappy bullshit count it still in play, only that the 5th blue wave did not finish on Friday, but will instead finish today. If that’s the case, we can’t go below the 78.6% extension of blue 1 from blue 4, as that will make blue 3 the shortest). That is at 4179:
If we go below that, this count is invalidated.
Another alternative is that we are in a 3rd wave, and if that is so, we may consolidate here-ish in the 4th blue wave, then fall again for the 5th blue wave, perhaps filling that old gap (green arrow):
It will all depend on which fibs I will end up being able to find down here, as either one is possible. Hopefully we do something telling like break the fib level from the first chart so I can view the second one as more probable.
As for playing this, since I still have many long puts, I intend to take some more of them off if we open around here and open a strangle, which is my preferred response to a move I as of yet do not fully understand. And that way, if the green 1 low is being put in at the open, we should see a mighty bounce, healthy for a strangle, but if we consolidate, then fall lower for the second option, I may even be able to enjoy strangle Nirvana, in which case I can catch the coming drop to close the put leg, then already have something on to enjoy the rally, too, profiting on both legs instead of having to sacrifice one of them. And furthermore, if we’re just outright crashing and I don’t understand the move at all, the strangle will do just fine in that case, too.
Note: When articles are first posted, most of them are made available only to my Patreon supporters (I do try to publish some public posts on occasion). Over time (usually after a period of a few weeks or so), I make all of the work public. To gain access to my work when it is produced, please consider becoming a patron. More information may be found on my About page and on my Patreon page. In a nutshell, patrons of any denomination (you get to pick the amount) will be able to read my weekend analyses, Tier 1 members ($20/mo.) get access to all of the articles I write, and Tier 2 members ($35/mo.) get access to those, plus counts on other instruments and my Discord chatroom.