Hi MarkrtMBe careful.In two days we have seen a downward A-wave...

Hi MarkrtM

Be careful.

In two days we have seen a downward A-wave fall from 53.5 to 32 On the original A-wave upwards 15.5-53.5 a 50% FIB retracement was 34.5 we passed that mark. Todays low 32 is about half way between 50% and 61%.(with 61.2% being at 30).

Even in this short a period that's a long way. At some time I am expecting a bargain hunters bounce so a B-wave bounce upwards.
The start of this B-wave could be from todays low of 32. Alternatively it could go down to test that 61% FIB at 30 before bouncing. Also what you proposed about 28 can't be ruled out. Neither can a SP lower that that.

In my daily chart below I speculated of what this bounce could look like, Notice it sort of forms the right shoulder of this entire recent rise.

Why the bargain hunters bounce. The thinking goes something like this.
Two days ago it was well over 50 and if I can buy tomorrow at 30, what a bargain. If it goes up to 53 inside a week what a profit. Once a bounce like this start then the FOMO cuts in and people chase the SP upwards.

That's how Dead Cat Bounces (DCB) got their name. At the start the cat looks like its leaping strongly upwards, then comes the turn and on the way down the cat doesn't look that lively. Once it passes the starting point of the leap, the vet takes a look as says this cat has been dead for quite a while. Someone must have throw it down hard onto a trampoline to get it to bounce that high.

With the charts its natural behaviour to see a bounce at sometime in a serious downturn.

Just the way I deal with the markets so that I am not surprised by what plays out. As always DYOR.

We shall see?

cheers Lies