Of all the reasons advanced for the recent sell-off, the pundits have failed to mention the super moon which maxed out the 31st. As good an explanation as any and better than most. To waste time trying to explain the mini-crash is to take your eye off the ball. Instead let us analyze how we are going to get the ball out of the rough. Friday’s 1000 point range can offer some clues. The shape of the candle is interpreted as a “hammer” as in, the market is hammering out a bottom.
Apart from Japanese analysis, the chart depicts prices falling over Niagara and then reversing and closing up. Worth noting that price bounced off the 200 day moving average– as well as finding support in the obvious support zone. We have drawn tw0 tight trendlines on the formation — neither of which is to our entire satisfaction, but servicable. In our recent letters we have talked about the alpha-beta-gamma– wave structure. While we will reinvest based on this analysis readers should understand that any analysis and investment is highly speculative at this time. Just as we got a V top we may get a V bottom, so you pays your money and takes your chances. It may be an elongated bottom –and, while it appears that we have in a compressed time run through the alpha, beta and gamma waves we can even have more sell off.
We still stick to the analysis we made before the sell off–a resurgent bull market for the forseeable future. If that seems persuasive to you and you are willing to bear the volatility and have a two year time frame then buying here can make sense. If you have stuck out the sell off, keep sticking.
For our accounts we will be waiting for the zeta wave. Presently the major part of our capital is in cash.