Let’s start for what is obvious, there is nothing impressive on CMG’s chart, as we can see here (link) three waves up; that we labeled as ABC, if we measure the move from our 1% extension we see the price moved approximately 20% above the ideal target at 632.32 hitting a high at 758.61. Here things get interesting, ideal support should have been 480.09 factoring the initial 20% deviation above our 1% as we see on this chart (link); nonetheless price derived 26%, so we have a differential of 6%, with a low at 352.96 instead a projected 386. That’s not much, actually was very good, mixed but good.
If we subdivide the decline on a weekly chart here (link), we have five waves down, very well subdivided, where the wave 3 down went as low as the 4.764 extension (link). This is perfect fibonacci pinball and statistically very clean moves if we see how the price has gone from one extreme to another in our monthly regression channel (link). This accuracy in the pinball and the linear methods lead us to be cautiously bullish and consider that from any point of view, CMG should see a standard retrace to 555.79 or 603.65 before a more significative decline ensues.
Certainly we could be bearish, based on this count and the fact that Bill Ackman is a holder, but not here, not now, probably later, but not here. As always price can prove us wrong and CMG can sell off to 0, according to crash callers, but we must respect our methodology.
Few Trades were taken in Chat Room
