The Big Picture Despite the rally on Friday, the big picture is that of a bear market rally on the verge of reversing back down. The charts below spell that out in Elliott Wave labels and some helpful trend lines and Fibonacci retracement zones along the way. They are all strikingly similar. One day next week the headline for an Alert will read: "Wave 3 Begins," with what will likely be new option picks. There is a little bit more on the upside that is possible on Monday or Tuesday, but the higher prices go the less room there is to go higher without blowing out the entire big picture thesis. That's not going to happen, the market is in the final stages of a bear market rally and the next move of significance is down. SPY The next piece in this EW pattern will be a third wave down, starting as soon as this Wave 2 countertrend rally ends. There are still two weeks left until the March 17th expiration, but expect new option recommendations going out a little further in time once that third wave down has been confirmed, likely by mid-week. QQQ Note how similar the pattern is between SPY and QQQ. The next leg down will also look the same, generating a lot of confidence that the pattern is unfolding as expected. IWM IWM projection for Wave (3) is all the way down into the 150's, providing a lot of leverage for April-May-Jun expirations. IYR IYR remains in a Sell Pending as per the March 2nd Update. Bitcoin - Just another stock..until proven otherwise. Bottom Line: Standing by for new option recommendations next week based on a break-downs below key levels/trend lines signalling commencement of new legs down across all indices. TSLA: Exponential Returns, Part II I'm working on a new white paper for TSLA which will cover the next 3-5 years of growth as set-out in last week's unveiling of Master Plan 3. There are a lot of moving parts in this analysis and it is becoming increasingly apparent that my "$3 Trillion" market cap (about $1,000/share) is woefully inadequate based upon the company's long term aspirations and intermediate term expectations. We thought at one time that Tesla was an electric car company, which also became an energy company, then a green energy company, then a manufacturing company ("making the machine that makes the machine") and now an AI company. I am stunned by the potential in terms of both growth and valuation and am at a loss for parallels, although AAPL and AMZN in the early 2000's keep coming to mind. I can only hope to be around long enough to see the vision laid out on Wednesday evolve and mature in the years ahead. The only question is how soon that future will be not only realized, but measured, by share price, market cap and percentage appreciation of once out-of-the money LEAPS. TSLA calls will be the best investment opportunity of this decade, whether as a trade, buy and hold strategic assets, or both. This will continue to be a major focus of this service and worth the price of admission in and of itself. Coming soon: Exponential Returns, Part II. TSLA - Daily Trend Model We have been waiting for a dip into the Fibonacci Retracement Zone which was finally realized on Thursday. Next week may offer the first lower risk opportunity to buy calls since the stock doubled off of the January low at $101. We will continue to view TSLA independent of our big picture forecast and remind subscribers that that during, "Exponential Returns, Part I" in 2019-2021 there were several -50% stop-outs in calls to go along the numerous triple, quadruple and quintuple digit returns along the way. It comes with the territory. Leading LEAP Candidate This Jan 2025 $420 LEAP continues to be my favorite buy and hold call option on TSLA for the rest of 2023. It traded as low as $17.80 last week after being as high as $29.75 on Valentines Day.
