The previously identified abgz formation we have looked at has collapsed and is much larger than appeared. We are now in the gamma wave and worse, are in a downtrend that is not predictable. Eventually we will see a zeta wave, but when is not known. Classic management technique directs either exit from the market or robust hedging. Below we will look at support areas.
Number 1 identifies areas which have previously been important. No 1 is probably the weakest of these but might have a chance for arresting the trend. Number 2 might almost be considered a part of Number 1, so there is an area of support rather than a precise number. The penetration of any of these lines is important, but if line 3 is broken we are looking at a test of the bottom of the chart.
We are reminded of Hemingway’s remark about how bankruptcy happens: “Slowly, gradually then all at once.”