The market rallied and relieved the sell-off that happened yesterday. I have not seen any pattern yet to suggest a solid conviction for a downtrend has started. But our Indicators prove to be still bearish. Therefore we will side with the indicators until a clear pattern shows itself.
The move down yesterday looks like a 3 wave pattern but we could probably need to look at a smaller time frame to see how if there is a 5 wave into the move or not. Im not caught up so much on EW as it proves to always change as the market makes its move. Todays move up however looks to be 5 waves. This doesn't bode well for bears.
Overall: Mid-term Down, Short-term Down. Action: Stay Short.
The chart above could be playing out an ABC for the last new high. This would suggest that the move up now is the final C of this leg if your following the red abc pattern. If we are following the red 12345 pattern then it would be over as the top is concerned. Both patterns are still in play, but try not to get too caught up on the pattern as its just another ever changing analysis. What is certain is our indicators.
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