Back in Aug. 21st, just the weekend before the Aug. 24 drop in the markets I wrote;
"Does this look like a Bullish chart? I don't claim a crash is coming, but what I do know is we are at risk of one. or a very nasty slide. With my market sentiment in Bear Mode"
But the descent actually started 3 days before this freefall. We are looking at similar situation now with indicators for the daily chart in OS condition with a weekly close in bearish position. Longer-term, this bearishness should last weeks to months based on my theory. But again as discussed yesterday, the bearishness needs to overcome the FEDs actions and stay bearish or this weekly signal will become an anomaly.
The possibility of this accelerative move coming might even surpass the lows made in August. This is the point where I would encourage everyone who follow EW to put aside the pattern counts and read what the indicators are telling us. Due to our bearish market sentiment along with a downward signal in our ST and PA, we can see that the risk is to the downside. Therefore, we must plan for this event regardless if it happens or not. So again, like the statement I made back on Aug. 21st. "I am not claiming a crash, but there is a risk of one."
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