There is a slight probability that CBA could form a Quasi Fractal. Based on Fib projections, F3 bottom could be somewhere in a 73-71 range. This Fractal would be confirmed by EW count so it would have an extremely high probability of a thrust higher from there, I'd say above 100 mark.
The rise above 84 by not making a new bottom would negate an expanding fractal scenario.
Bendigo Bank (BEN) could sport the similar fractal structure. Let's wait and see, could take a few weeks.
View attachment 60266
Hi,
My last post was about the posibility that the Fractal could form in CBA. Just in case CBA will dive, I would be informed what is happening, and no any suprises whatsoever at this point. The form of the two fractals is the key-if they are similar, then the the pattern has a forecasting value.
At this stage it is early to tell whether the market will go that way. I'd better tell what I see in EW terms.
I do agree that from 2009 CBA advanced in Three waves, just it is not clear about how we can label the last Top. Is it realy wave (3)? If it is, then where is wave (4)? If you put a (4) label on the last bottom at 73, then it looks too short comparing it with wave (2), which lasted more that year and a half. Just two months correction for wave (4)? I doubt it.
The whole purpose of the corection at this degree is to correct a Bulish sentiment, to force people to throw in the towel, if you know what I mean. To make them feel the same as they felt in 2011-2012. Two months and 13% price drop just can't do this. Also, using EW channelling technique, You can see that it has much more to go (in terms of time) in order to reach the lower line. I can't say that this is impossible, but we must face the fact that only CBA from all major banks sported such a nice and steep wave from 2011 bottom.
Other banks just don't look right for a (3) wave top. More than that, they are in a correction that lasts more than a year, and most likely this correction is in the later stages. This doesn't leave much room for CBA to sport a year long correction from now, if other banks start to rally. So I put an Alternative label- maybe it is just the first wave of (3)?
View attachment 60443
But let's leave the logic aside and say that wave (4) ended at 73, and 1 wave of (5) is done.
Using Fib relationships were wave (4) subdivides the entire Impulse into 38,2/61,8 ratio, we can predict a Top at ~103,6. But to reach this target price must stay in a Channel, and this means that CBA will climb at least 3 years to reach it. I doesn't make sense... Otherwise it will brake the Channel upwards, adding more evidence that the upcoming advance is not the wave (5).
It is hard to trade CBA at this stage, (unless buy and hold). It would look better if it could have more sideways movement, at least a Fractal that I was talking about. I personally see a better setups in other banks. If you enter it now, the stop distance is too great... Then it is probably better to wait until it takes out ATH and use this breakout as an entry, but this is not for me, the degree of the breakout is too big... I'd rather prefer to pick up bottoms...
Cheers,
What is "opportunity cost"?
Biggest one day drop in 6 years
WOW!!
Beautiful.
It's the greatest stock in our market.
I hate this stock.
As a shorter it's natural.
Bond markets are selling off and so the yield obsession is now a value trap.
Lets' see Greece default, the US stay looking weak and the game is back on!!!!!!!!!
And let's watch as the world collapses [we wouldn't hope for this would we?] and forget the profits that CBA has returned to share holders these past 6 years.
Another example in addition to Triathlete's explanation would be sitting in a non-performing stock for a sustained period while you could have had that money in another stock which is making good gains.
A big call to be all doom and gloom...both the broader market and CBA. Why would anybody pick one of the strongest stocks on the ASX to short? Plenty of support for CBA in this area too.
Currently we are at a previous support level and it will be interesting to see if CBA will hold here or goes as far as the next strong support at $66.50 all based on the monthly chart above.
You reckon this is valid? We discused this possibility earlier, it is still too early to make any conclusion, but if CBA drops in five and breaks 73.55 i'd say it's over. Let's wait and see. If it happens I change my super to cash as they are invested heavily in CBA and other big 3
We use cookies and similar technologies for the following purposes:
Do you accept cookies and these technologies?
We use cookies and similar technologies for the following purposes:
Do you accept cookies and these technologies?