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Monday, January 25, 2021

Elliott Wave Update ~ 25 January 2021

(Fixed most of my spelling and most of the grammar - when I get in a hurry, I type as bad on my blog as I do my phone)

Wow, the price action is insane. If you have been following Zero Hedge's posts about how the most shorted stocks have been shooting higher in amazing short squeezes, then the market has probably entered the fabled "blowoff top" phase that everyone always likes to throw out there as if it was ever a real thing.

Well, it appears it may very well be a real thing, so we'll see if it has some legs. I have several counts but I'll be honest I'm looking at the most bullish short term count as perhaps the top one as a result of this morning's price action. Are there more hedge funds about to get crushed?

(Note: at those prices the squiggles would be relabeled a bit - as wave [iii] cannot be shortest) So the reworked squiggle would probably resemble this giving us some alternation between matching subwaves:
And thus, the reworked squiggles work very well because now at least waves (iv) and [iv] alternate in form from (ii) and [ii]

The reason I point to this count now is that there exists a powerful dual Fibonacci relationship at higher prices.

The range is 42,441 - 42,485 a fairly tight window for two Fibonacci relationships:

(B) = 1.618 * (A) @ 42,441

Within (B), C = .618 * A @ 42,485

Ok, well now that I have "pinched" myself maybe back to reality, I have 2 more counts.

The second count is the market is in some kind of ending diagonal because of today's overlap.

The last best count is that the market peaked and you saw a final spasm today with the ridiculous short squeezes....

Tesla made a new high which was required but not sure if its the top.

Yeah, Gamestop. I could show you 8 - 10 other junk stocks that look the same.  Volkswagen all over again? You know the Robinhooders ain't gonna stop trying to squeeze which means the HFT machines are front-running spoofing , I mean "bidding" things higher. 

Remember, in this low liquidity market, the active players are getting "amplified" by the algorithms.  So yes, Robinhooders can affect the market when there is yet to be serious selling. You've seen that today an instant "vacuum" downward occurred for why? Because when the machines glitch or their algo's get confused they can certainly amplify things in a negative way also.

Ok question, who here thinks since the infamous (2011?) "flash crash" (blamed on a "fat finger" of course) that the market has gotten more secure? Of course not! You've seen the carnage just last year! Nothing is fixed, conditions are worse!

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