Irrational exuberance is back. All time market highs. FAANG explosion!! Pot Stocks worth $5-10B on less than $100M in revenues. Overbought and relative strength readings on every sector screaming for a break.
Apple's chart tells it all. The two year run from early 2013-2015, shows a well formed channel and a stock that played nicely in that channel. The second channel which is now 30 months in the making is also well defined and the stock has played nicely here as well. The consolidation period that followed the first channel lasted 15 months and the stock lost 35% of its value but held a key FIB level.
I am anticipating that we are going to enter a corrective wave. With the uncertainty surrounding the elections, I think we could be entering a similar or worse correction both in extent and time than what we had earlier this year and possibly as long as the period that followed the first channel.
Only time will tell but if history repeats itself, it may be prudent to start looking at puts on the index of your choice to protect gains.
Apple's chart tells it all. The two year run from early 2013-2015, shows a well formed channel and a stock that played nicely in that channel. The second channel which is now 30 months in the making is also well defined and the stock has played nicely here as well. The consolidation period that followed the first channel lasted 15 months and the stock lost 35% of its value but held a key FIB level.
I am anticipating that we are going to enter a corrective wave. With the uncertainty surrounding the elections, I think we could be entering a similar or worse correction both in extent and time than what we had earlier this year and possibly as long as the period that followed the first channel.
Only time will tell but if history repeats itself, it may be prudent to start looking at puts on the index of your choice to protect gains.