Overview: it has been a long while that we have been perfectly predicting the daily price action. Finally, today was the day that we got a minor invalidation.
Let's review what was the expectations of yesterday:
Update: This morning before the market open, we went lower to the exact area I had as 5 of (A) and then had a pullback to the area I had as wave (B) at market open. This was the point that the actual price action diverged from our anticipation of tagging another low as wave (C) 5 of a (red) before reversing higher.
The new labeling I have for wave 5 of a of (III) is fine in regard to its structure, but it is a bit shorter than the minimum fib ratio for a typical wave 5 (that was actually the tricky part).
Now, I believe we completed wave a of (III) this morning at 3613 and initiated wave b of (III). Don't forget that we were not expecting the bottom to be much lower (3550-3595).
So far, I see that we have completed a zigzag in this wave b. This means we have the possibility of having all the three correction types (double zigzag, triangle, or flat) in here. Hence, the only thing I can say at this point is that we need a pullback and its extent will determine the type of correction that we are having. Some points that can act as a support for the pullback are 3670, 3694, and 3718.
Corrections are tough to predict by their nature and specially in this volatile market, the best thing is to minimize your exposure until the price action is crystal clear again.
Let's review what was the expectations of yesterday:
- The price action followed our revised expectations of this morning.
- We are in wave (A) of 5 of a of (III).
- Potential target for wave a of (III) bottom: 3550-3595
Update: This morning before the market open, we went lower to the exact area I had as 5 of (A) and then had a pullback to the area I had as wave (B) at market open. This was the point that the actual price action diverged from our anticipation of tagging another low as wave (C) 5 of a (red) before reversing higher.
The new labeling I have for wave 5 of a of (III) is fine in regard to its structure, but it is a bit shorter than the minimum fib ratio for a typical wave 5 (that was actually the tricky part).
Now, I believe we completed wave a of (III) this morning at 3613 and initiated wave b of (III). Don't forget that we were not expecting the bottom to be much lower (3550-3595).
So far, I see that we have completed a zigzag in this wave b. This means we have the possibility of having all the three correction types (double zigzag, triangle, or flat) in here. Hence, the only thing I can say at this point is that we need a pullback and its extent will determine the type of correction that we are having. Some points that can act as a support for the pullback are 3670, 3694, and 3718.
Corrections are tough to predict by their nature and specially in this volatile market, the best thing is to minimize your exposure until the price action is crystal clear again.
