At the $60 crude oil price level a small H&S pattern was starting to take shape. The speed of the June rally was just too fast as a near vertical spike makes this a candidate for being a bear market rally.
Diagonal 4th wave rallies can explode and come back hard and travel much higher than expected but it’s quite normal for diagonal wave structures.
This oil rally can also fit into an expanded pattern so 100% retracement could happen.
I never try to put alternate wave counts up in the same chart but I switch back and forth until a wave count sticks longer than normal. I may have to lower my 5 waves in Minor degree down to a diagonal 5 waves in Minute degree but for now, this will do.
The Gold/Oil ratio is at 24.7 but I would like that to expand much further.
The action may be in the pipeline battles with refineries blowing up and pipelines getting old!
Have A Great July 4th America!
It seems tech investors only see a rosy future as all the fundamental changes that the trade wars are producing are being ignored. Markets move because of hope and greed but on the next correction disappointment and fear will suddenly come back.
At 7900 the Nasdaq is approaching record highs and another double top as well.
I know I have complained that there should be “No” 5th wave positions uncapped, well I broke that rule 5 times and even for the 6th time as I have Primary degree wave 5 still not included. 6 sets of 5th wave tops are pretty rare as I have run out of space at the top.
A small gap has also formed so in a mini panic this gap should have little problem in getting filled. Analysts talk about the market’s bull run just getting started. A melt-up is sure to come, based on the hope that the trade wars will end.
When the majority are bullish then who is left to come in when the experts are screaming bullish sentiment 24/7? Of course when the bears attack they will be screaming just as loud to get out of stocks.
The Gold/Nasdaq ratio is at 5.57 this morning with 6.38 being the expensive record to beat. Real cheap would be about 1.18 so there is a long way to go price wise before the Nasdaq becomes cheap again.
It would be a good laugh if the Nasdaq was held up due to highly processed veggie burgers (BYND) and dog treats (CHWY).
It’s also a new moon today followed by Independence Day celebrations on July 4th which can produce surprise reversals on Friday!