Public Chart: Let’s Take a Look at the Huge Distribution Top on $TSLA

Whether we like it or not, $TSLA was in a bubble. And whether you think the Green Energy movement has a future or not, the stock is simply way overpriced.

And when we zoom out, the sideways trading range it’s been in for two years (!) doesn’t look good, because a range like that can only mean one of two things:

  1. It’s a long re-accumulation prior to another markup
  2. Or it’s a distribution

But in an inflationary recessionary tightish monetary policy era, just how high do you think it can go? Nah, I think it’s far more likely had its day and will come back down to earth.

And scarily, there is very little volume on the way down:

TSLA

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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.


One Last Intermediate-Term Discussion for the Weekend (Important Perspectival Considerations)

This post is just some chill weekend things to consider. Maybe a companion to a cup of coffee or some whiskey. Nothing urgent in here.


This is back burner stuff, so just tuck this away somewhere and pull it out only in case we need it. As I’ve said, I’m not particularly in love with the bullish thesis, but I also won’t completely dismiss it yet, either. I want to summarize why, and discuss a target possibility and what that could mean for various instruments.

  1. We know that especially by the June lows, sentiment reached absurdly poor levels, levels typically associated with lows that have great endurance (months not weeks).
  2. We know that historically, the market has never topped (so far as I can see) before a hiking cycle has begun (I understand this time might be an exception).
  3. The structure off the top of the market has been especially choppy, perhaps too much so for a real bear market.
  4. The rally we recently had broke a lot of records, and did a lot of things that typical “bear market rallies” tend not to do.
  5. The breadth thrust we had during that rally we just had was unusually strong. Stronger than the thrusts in typical—even very strong—bear market rallies of the past.
  6. Also, the NYSE Composite Index made a new high after the other major indices, which it has never done before. Usually, it diverges, making a lower high when the S&P makes a higher high at the high. The NYSE Composite topped on 1/14/22; the S&P on 1/4/22. Highly unusual.

Because of all of that, I am at least open to the possibility that we go to all-time highs once more. That may sound ridiculous, but that rally did impress me. Now, if we go and check back in on that head and shoulders neckline that we just broke today and fail from it, so be it. I’ll be all bear for months. But what if we don’t? If we don’t (fail from it), this is roughly what I would expect.

IF we do rally, I’m not expecting some ridiculous rally to 7500 or anything like that. There is a terrific fib at 4950.25 on the nose. It is the 50% extension of the rally from the COVID low to the all-time highs, extended from the June low:

SPX

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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.


Weekend Article: A Look at the S&P 500, the Dollar, Bitcoin, Amazon and Tesla

Nothing has changed regarding my views all this week that lead me to believe this countertrend rally is ending. I spent much of the week seeking wave balance at these highs for instruments across the board, and we have some lovely structure that has developed. All of those relationships remain valid today as we opened little changed. The two most significant levels of balance for $SPX were 4003 and 4009 both of which we poked through during the first hour of today’s trading.

Super zoomed in, the S&P 500 counts well as an impulse wave down, and there is a retracement in the afternoon that is at least consistent with a wave 2 of a small degree, because there was balance right at the close for that small rally:

SPX

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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.


Some Fibos: $AAPL, $TSLA & $AMZN

I will show some examples of wave balance being put in here. If they stick, the structures look good here.

Apple:

AAPL

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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.


$TSLA: Count, Structure, Target

I last discussed Tesla here, and discussed its triangle and how I was inclined to interpret that. From that high, there seems to me to be an excellent impulse wave (green 1, green arrow), followed by a 3-wave correction for green 2. If this is correct, it should head to $600 (or lower) soon.

TSLA


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.


These Triangle Structures You See Everywhere Are Likely to Fail

I will show two examples (for $AMC and $TSLA), but they exist on many instruments.

$AMC looks like this:

AMC

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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.


What $TSLA Tells Me Here

I track $TSLA on my “Other Counts Page,” which I periodically update, but I want to share today’s update with everyone.

  1. We do have an inverse, and we shouldn’t ignore it.
  2. We have a clear impulsive rally off the low (green 1), recapturing an important, long-term channel.
  3. The pullback off that impulsive rally came exactly to where we would want to see a “2” come to (the orange box).
  4. That was followed by a much funkier rally (blue 1), but one which nevertheless consists of 3 distinct highs (a candidate for a leading, expanding diagonal).
  5. And today, it pulled back, again, exactly to where we would want to see a “2” come to (the 61.8% retrace).

And so: it still needs to prove itself. But, trade fundamentals all you’d like to, but until this proves otherwise, this is a candidate for a 33% rally. It may not do it, I understand. But with a price structure like this, it’s possible that it does, and I can’t ignore that just yet.

So what’s it telling me? It’s at least telling me that there is at least potential for a very bullish market.

TSLA


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.


Weekend Smorgasbord of Observations

I think I will simply walk through a pile of everything I see here.


1. No Matter How I Slice the S&P, I Think We Will Go Higher

There are 8,000 ways to examine the S&P here, but in general, I think they all still sort of point up next.

On the most bullish view, We have broken up out of a bullish wedge inside a bigger bull flag in a wave 1 & 2 in minor (green), then minute (blue), and then finally minuette (orange) degrees. On this count, we should be entering the most powerful central thrust of this impulse wave.

In support of this count, first at the lows, and then twice this week, the drops have felt awful, steep, sharp and abrupt. And that’s what “twos” feel like, generally. They are spooky, no one wants to buy them, and as a result they miss the “threes,” which is where the real money is made. So if we move 300-400 points next week in a real hurry, we might be doing something like this.

ES

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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.


Member Request: A Detailed Look at $TSLA

A member has requested an examination of $TSLA. There are many technical observations I would like to point out.

Stocks such as this are totally at the mercy of a liquidity-driven market, and for the time being at least, liquidity is fleeing. That said, for all we know, the Fed may respond dovishly to the events in Europe, driving liquidity back into the system. And if so, there are many names such as this one that can resume strength. Let’s look at the chart.

There are many observations I would like to make:

  1. I have long suspected that $TSLA is somewhere in its cycle (yellow) 3/4/5 cluster.
  2. I lean to the view that it is in the 3/4. One reason for that is the move from the March 2021 low to the all-time high. It does not have the appearance of an impulse wave.
  3. If that move is a “correction,” then—since it made a new all-time high—it is likely in a huge “flat” for cycle (yellow) 4.
  4. If that is true, then we should be in the primary (pink) “C” of that 3-wave move.
  5. If this is a 4, the low made at the end of February 2022 reached an appropriate level for a wave of that degree
  6. And since there are now 3 distinct lows, we may count the structure off the all-time high as an ending diagonal (the 5-wave count in orange)
  7. If all of that is true, then so long as it stays above about $772, we may expect that it has begun a new impulsive structure to the upside.

TSLA

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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.


Member Request: An Update on $TSLA

$TSLA is bedeviling to count all year, so I don’t have high confidence in any one count in particular yet, but, I do have some structure here that I think may help us. I suspect that if the markets rally sharply here, this will travel at least to the upper trend line.

TSLA


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.