note the thrust coming into this very important .786 retracement node. additionally, we have a 1.618 projection a little lower sitting right on top of .841 retracement. (1/1.1892 = .841 equal octave scale of music ratio) and we can throw in some polarity and bullish divergence so would expect some support or a pause.
that being said, I enjoy doing ratio analysis so here’s AMZN / BABA. the first graph below is back almost 4 years ago when I did the same relative strength look because, at the time (believe it or not) BABA was stronger that AMZN. don’t believe me? look at the ratio … it had been going down for a couple years as BABA climbed but then guess what, measured moves and retracements and a bunch of pattern stuff gave AMZN the support in the ratio and off it went and the rest is history. (note, did I mention – once – anything to do w/ sales, or revenue, or anything like that? nope …just numbers and patterns for me)
if seriously trying get long BABA I would watch for a daily or weekly SRC before entering. when I look at those relative strength ratio charts it looks like BABA is about to get smacked even harder so caution warranted … wait for an SRC.
a lot going on in this chart … bottom line is either here or a little higher we have significant resistance with the most “basic” of price projections completing the AB=CD.
in this case we have two AB=CD’s
a larger orange one that starts at the all time low around 58. and a “fractal” blue AB=CD that starts at/around 129.
I have also use a very helpful technique taught me by my friend and mentor Michael Jenkins. It’s simple and very powerful. basically take 1/8’s of the signal reversal candle and project up … as you can see, we have a 1.0 projection and a .5 projection hitting at our lower and upper target zones respectively.
we also have the light blue parallel channel being hit at the upper end
extension targets are present …
then, no kidding, NOW, I’ll take a peak at the “potential” count. what i do feel “ok” about (and that’s all I will every to admit to w/ Elliott Wave – an “ok”) is the sub degree count that is finishing (labeled in blue) and that shows we are finished/finishing 5 waves. Is the THE 5 or the 3rd wave …I’m going w/ a big 3 and a 4th wave correction is inbound …