Yesterday I bought UWM, the double-long Russell 2000 ETF, at about 33.80/share. When it gapped up today, I set a stop at 34.60, which of course triggered before 11:00. UWM closed today at 32.88.
While only three waves down were seen today, they certainly looked impulsive. This is most easily seen on the 5-minute chart, which I have posted - this morning's move down looks like five waves of what I think are Miniscule degree. The operative question is whether Submicro (3) ended at today's low, or if that was simply Miniscule 5 of a 9-wave move and we have still further to go.
Using the "2008=2011" analogue suggests that today was May 20, 2008 - one day after the May 19 Intermediate wave (2) of P[1/A/W/donut] top at 1440. If indeed Minor 2 (if this was in fact Minor 2) did end in a truncation at ~1267, and if we're going to follow the same pattern, we should drift downward into early February, move choppily up until mid-March, and the wheels fall off the cart sometime around April - sell in May and be too late. I doubt the pattern will persist for so long, but....
The obvious near-term bull count is that this is (b) of [y] of 2. Daneric has a good chart showing the most viable count for this, which suggests that if that is indeed the case, it just now ended. Certainly, there is reason to believe that (c) of [y] could be coming - today's low was at higher RSI on a few timescales (though not at 5-minute) - on the other hand, we do have that 2008=2011 pattern that is still holding, and I have the strong feeling that when today does finally break ranks with 2008, it will be a break to the downside.
At any rate, I don't want to go long again unless 1238 is breached before any new lows are made.
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