Hey, POKERSAM. No one responded on another site to this McHugh analysis? Perhaps it leaves too many unanswered questions? That said, I'm always interested in your interpretation. TIA. Two
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"Prices have been rising on declining volume for several months now, and Monday's rise on declining volume is likely an early warning that a top of significance is approaching. The big question Monday night is, has the final wave of this rally from March, wave (E) up of C-up of (B) up started Monday? If so, it means (D) down bottomed precisely on our latest scheduled phi mate turn date, Friday, September 25th. Except for volume, Monday was a strong up day, so there is a good chance (E) up has started. Here is the problem: There is no way to know if (E) up will take prices to the upside targets that various patterns suggest, or whether it will truncate. We are now in a high risk zone for long positions. Wave (C ) down c an start at any time, or delay for several weeks while (B) up finishes.
"The chart [for the Nasdaq] is bothersome. It shows that a textbook perfect Rising Bearish Wedge has formed, and is nearly complete in the NDX. These are termination patterns, and highly reliable. Minimum downside targets are the start of the pattern which in the case of the NDX would be 1,050, suggesting a 40 percent plunge is coming, and sooner than many believe.
"Weekly volume has dropped dramatically the higher prices have risen, suggesting a major top is approaching. The steep slope of the volume decline, the steep divergence, suggests prices will not reach new all-time highs before a major decline arrives."
AI
