The market has been behaving very erratically for the past two week. Many individual stocks are being short squeezed beyond imagination while, simultaneously, most market sectors are closing red day after day; and volatility closing green. What is going on?!?!
Is it still possible that the rally since March 2020 is a false hope 'B' wave propelled to insane heights by unprecedented stimulus? I had nearly thrown out this idea based on the length and strength of the rally. However, if this was the case, and it was all merely an illusion, then the phoenix may rise again in its most powerful and dreaded form, the dreaded 'C' wave.
I posted about this being a Wave B for many months. It lined up so well. It got to the 1.236 fib ext above the Feb 2020 high and flirted with it for a while. It then made a clear break above and I kind of gave up on the idea. I have often wondered if the Fed's intervention pushed this market beyond the traditional level that I read in all the Elliott wave articles. It has all of the signs of a Wave B with only a handful of companies (FAAMNG) pushing it up given how bad things were on the ground. However, by September the whole market was jumping in. So, I just assumed that I was wrong and this is a motive wave. FYI, it currently sits at 1.38 extension.
jscottw
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@Dr_Roboto, Fascinating. Have you charted any future projections from here using EW? Would love to see some. Cheers.
Dr_Roboto
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@jscottw, I have posted lot of wave charts. They are usually wrong because as cool as waves are they are really hard to get right and only make sense in hindsight.