It looks to me like ERX (Direxion Energy Bull 2x ETF) is ironically forming a very bearish outline which seems to coincide with other bearish indicators for oil and equity markets.
What's interesting here is the coexistence of a rising wedge form (highlighted in orange) with what appears to be quite a tidy Elliot wave count.
There is a pretty clear set of 5 major waves dating from August 2021 when the market produced a triple bottom and began to rally.
There may be alternate counts here but I do think they will all arrive at the same conclusion that wave 5 is in.
Since the end of 2021, there is also a set of 5 secondary waves which correspond to the primary wave 4.
Furthermore, this set of secondary waves appears to form a rising wedge which I have highlighted in orange.
Shorting leveraged ETF's is often risky but it does seem that this correlates with other moves taking place on the market.
For instance, EXXON is displaying a rising wedge.
Chevron also seems to be forming a rising wedge after an earnings miss.
These correlate with the rising wedge I describe in this chart and my suspicion that wave counts may also correlate.
Again, I emphasise that shorting leveraged products is risky and as always, do your own research, manage your risk properly and be careful with picking entries.
If you are interested in the market-wide phenomenon I have described here you may be interested in my other recent ideas which all examine aspects of the same phenomenon.
Additionally, I am open to other interpretations & advice on how to count this so comments are welcome. I believe that the rising wedge here adds weight to the view that we have just had Wave 5 in the energy and oil markets and that a correction is en route.
@Amazile, took around 15%. Less than I hoped but the commies ruined my trade lol
Amazile
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@shred101, I bought at 17$... still trying to decide if it is time to sell or not
RogueEconomics
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@Amazile, The Russia issue has changed everything since I wrote this trade. I think the FED is now key to this trade because I do think they're planning to try to crash commodity markets by driving up the dollar. This is how they'll meet their inflation mandate if that makes sense.