Written by Rick Ackerman, Rick’s Picks
Thursday’s exhilarating plunge has given bears a ray of hope in the form of a minor impulse leg on the daily chart. I’ve labeled it in red in the chart later (below), but it will be bucking the larger and more significant uptrend labeled in green.
We should know by next mid-week or so whether the selloff is going to get legs, since, if this becomes likely, the evidence will come in the form of a downtrending ABC pattern that exceeds its D target. We’ll keep out fingers crossed, since the only way for the economic world to return to something like normalcy will be for the Dow to shed 10,000 points and bring everyone, us, not just investors, back to earth. From a purely technical standpoint, however, and strictly speaking, the pattern shown is so far just another correction in a bull market that has been running loco for more than seven years.
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