Tesla Update
It has been a long time since I have done a long-term Tesla update. I wanted to make sure y'all aren't losing sight of the forest for the trees though. There are quite a few points that I want to make though, so this will likely be a longer read than y'all are used to from me.
First off, I want to explain the significance of all the different colors on the chart as it has the rainbow. The turquoise and yellow fibs are tracking the possible ALT pattern. The white/red, blue, orange, & green fibs are tracking the primary count. Next, I want to bring your attention to the complexity of this pattern off of the $299.29 high. As you can see, it has carved out sub-division after sub-division. This is a hall mark of corrective counts. The main question when it comes to the larger/long-term chart; are these sub-divisions over? With the initial strength that our pattern showed off of the recent April low, it presented as a bullish count. I'm not so sure of that now given the proceeding structure we have been presented with. In all honesty though, I can come up with several reasons supporting the wave ((2)) being over already.
Reason #1 for wave ((2)) being completed; MACD. On the 4hr chart, MACD made its low on 23 Oct 23'. This is normally what we would see during the largest A wave of any corrective pattern. Afterwards, we carved out the (B) wave retrace, followed by a new low made on positive divergence on 22 April 24'. Then, reason #2, on 05 July 24', MACD made a new high above that of the wave ((1)). This is typically what we would expect from the beginning of wave ((3)). Reason #3 is that price hit a bottom in between the 0.618-0.786 retracement fibs and below the 1.382 extension fib of the (A)-(B) pattern. All very standard and what one should expect to see.
Where things start to get tricky, is the top made on 11 July 24. I was expecting a deep wave 4 due to the shallowness of wave 2. This was to be followed by a new high on neg div for wave 5 of (1) of ((3)). However, we didn't get that, and instead, price dropped almost 33% in total value or almost 70% of the prior gains before consolidating higher again. This is a huge part that made me ask the question; is this all another sub-division of wave ((2)) in the form of a larger degree ((B)) wave???
When looking at this from a bearish stance / continuation of the prior corrective pattern, things start to look very fishy. The top of the recent pattern in July looks incomplete. Is this because it isn't in fact a bullish structure at all, and instead, is an abc pattern completing primary wave ((B))? MACD made a new local low on 25 July 24', but it did stay above the low made from our 23 Oct 23' low. This MACD reading is just something that gives me pause as it wasn't expected. One thing causing me to struggle with this, is it would mean that ((A)) lasted 200 DAYS longer than ((B)). Although nothing in regard to EWT governs timeframes; it just seems a little off they would have that big of a time difference between each other.
Either way, rather we're still in wave ((2)) or have officially started wave ((3)) already, I am completely convinced that price is in an immediate bearish/corrective pattern at this time. This last move looks clearly corrective to me as there is much chop/overlapping in price action. We have hit the orange 1.5 extension fib which governs the miniscule ABC pattern. Price has also breached the green 1.0 that governs the subminuette abc pattern. Not to mention we have already breached the 0.854 retracement fib governing this move lower off the $271 high. For all tense and purposes, we have hit ALL the minimum requirements for price to move lower again. IMHO, the top is either already in, or extremely imminent.
Once price moves lower, we need to be looking very closely for clues that dictate if this is intermediate wave (2), or primary wave ((2)). Wave (2) targets $182-$167, while wave ((2)) targets $138-$102. My gut is telling me that we're still in wave ((2)), but we cannot know for sure without the ensuing price action as I explained above. I can find reasons to dispute and support each differing count. For now, I will wait patiently for clues and maintain self-discipline/control.
First off, I want to explain the significance of all the different colors on the chart as it has the rainbow. The turquoise and yellow fibs are tracking the possible ALT pattern. The white/red, blue, orange, & green fibs are tracking the primary count. Next, I want to bring your attention to the complexity of this pattern off of the $299.29 high. As you can see, it has carved out sub-division after sub-division. This is a hall mark of corrective counts. The main question when it comes to the larger/long-term chart; are these sub-divisions over? With the initial strength that our pattern showed off of the recent April low, it presented as a bullish count. I'm not so sure of that now given the proceeding structure we have been presented with. In all honesty though, I can come up with several reasons supporting the wave ((2)) being over already.
Reason #1 for wave ((2)) being completed; MACD. On the 4hr chart, MACD made its low on 23 Oct 23'. This is normally what we would see during the largest A wave of any corrective pattern. Afterwards, we carved out the (B) wave retrace, followed by a new low made on positive divergence on 22 April 24'. Then, reason #2, on 05 July 24', MACD made a new high above that of the wave ((1)). This is typically what we would expect from the beginning of wave ((3)). Reason #3 is that price hit a bottom in between the 0.618-0.786 retracement fibs and below the 1.382 extension fib of the (A)-(B) pattern. All very standard and what one should expect to see.
Where things start to get tricky, is the top made on 11 July 24. I was expecting a deep wave 4 due to the shallowness of wave 2. This was to be followed by a new high on neg div for wave 5 of (1) of ((3)). However, we didn't get that, and instead, price dropped almost 33% in total value or almost 70% of the prior gains before consolidating higher again. This is a huge part that made me ask the question; is this all another sub-division of wave ((2)) in the form of a larger degree ((B)) wave???
When looking at this from a bearish stance / continuation of the prior corrective pattern, things start to look very fishy. The top of the recent pattern in July looks incomplete. Is this because it isn't in fact a bullish structure at all, and instead, is an abc pattern completing primary wave ((B))? MACD made a new local low on 25 July 24', but it did stay above the low made from our 23 Oct 23' low. This MACD reading is just something that gives me pause as it wasn't expected. One thing causing me to struggle with this, is it would mean that ((A)) lasted 200 DAYS longer than ((B)). Although nothing in regard to EWT governs timeframes; it just seems a little off they would have that big of a time difference between each other.
Either way, rather we're still in wave ((2)) or have officially started wave ((3)) already, I am completely convinced that price is in an immediate bearish/corrective pattern at this time. This last move looks clearly corrective to me as there is much chop/overlapping in price action. We have hit the orange 1.5 extension fib which governs the miniscule ABC pattern. Price has also breached the green 1.0 that governs the subminuette abc pattern. Not to mention we have already breached the 0.854 retracement fib governing this move lower off the $271 high. For all tense and purposes, we have hit ALL the minimum requirements for price to move lower again. IMHO, the top is either already in, or extremely imminent.
Once price moves lower, we need to be looking very closely for clues that dictate if this is intermediate wave (2), or primary wave ((2)). Wave (2) targets $182-$167, while wave ((2)) targets $138-$102. My gut is telling me that we're still in wave ((2)), but we cannot know for sure without the ensuing price action as I explained above. I can find reasons to dispute and support each differing count. For now, I will wait patiently for clues and maintain self-discipline/control.
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Bonam Fortunam,
--Tyler
Bonam Fortunam,
--Tyler
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