Wednesday, February 19, 2014

Not much time to post but beware the ending diagonal on metals and miners.

Nothing is certain at this point about the metals/miners breakout yet.  TRX, for example, has had a nice little pop but until it breaks above about $3.20 it is still in the range of significant likelihood of seeing other wave down to form an ending diagonal as shown below in the TRX 240 minute candle chart.  This ending diagonal theory is not a certainty but rather something to be respected while you gamble.

In fact, the smart money looks at the 3 waves up shown below and says "If a 4th wave happens then it will be a sideways correction giving me more time to observe. So why not do it on the sidelines in case the end of this run already happened and the next move is a big gap down headed for the bottom of the channel one last time".

Besides, the 3rd wave gap is already behind us so you already picked that up.  Fear and discipline will win the day.


1 comment:

Chance_Nation said...

Captain,

Appreciate the update. You had me at: "the smart money looks at".

Thanks again,

Chance

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