If SMH retest its ATH of on Apr 12, it will paint a textbook three drives pattern w/ 1.618 extensions. Normally I have to fudge a bit on the candle wicks to fit a three drives but this one's perfect as-is. We're already in the PRZ of the large shark pattern from the ATH, and the retrace targets of both bearish patterns line up perfectly.
Look how many gaps are in this current third drive... the fact the MMs have to pump futures to move this thing is a dead giveaway that this rally is near exhaustion. It confirms the fundamental narrative of three-drives patterns. I don't know where the indices are gonna sit when this thing retests, but semis being the canary in the coal mine... I would be looking to sell or short the market the following week if a reversal from the ATH is confirmed.
The timing of it makes sense. I don't anticipate a China deal from this visit so we're prolly looking at June at the earliest for a trade deal. If SMH hits the ATH, it probably means the indices have broken current resistances and are on the way to their ATHs as well... complacency will be rampant. The following week earnings start and you can be sure there are going to be some bombs dropped in the form of revised guidance or missed revenues. Combine that w/ the current bubbly valuations and I think mid-April to mid-May is gonna go to the bears.
Long until Apr 12 then it's time to be bearish.
Look how many gaps are in this current third drive... the fact the MMs have to pump futures to move this thing is a dead giveaway that this rally is near exhaustion. It confirms the fundamental narrative of three-drives patterns. I don't know where the indices are gonna sit when this thing retests, but semis being the canary in the coal mine... I would be looking to sell or short the market the following week if a reversal from the ATH is confirmed.
The timing of it makes sense. I don't anticipate a China deal from this visit so we're prolly looking at June at the earliest for a trade deal. If SMH hits the ATH, it probably means the indices have broken current resistances and are on the way to their ATHs as well... complacency will be rampant. The following week earnings start and you can be sure there are going to be some bombs dropped in the form of revised guidance or missed revenues. Combine that w/ the current bubbly valuations and I think mid-April to mid-May is gonna go to the bears.
Long until Apr 12 then it's time to be bearish.
