In the second part of the first post I wrote during January 29th you can read:
And this is exactly what happened. It started a correction that took out at the end of the week the 4 pass Pit gap at 3194-3200 and it did it during a pit session.
See the PIT daily chart:
Now, In the same post I also stated that after the correction of that extremely rare 4 pass gap at 3194-3200 the odds should be in favor of the correction of the 3 pass gap left downside at 2970-2975. But in the mean time the market, during the correction upside, left an other 3 pass gap at 30285-30395. And this means that if the initial odds where in favor of a correction downside towards 2970-2975 now those odds are doubled.
Clearly we are speaking about odds and clearly this is only one part of the equation. So, in order to further deepen into current situation let's analyze the market in a downside perspective: 
Having said that generally you can begin to speculate about a possible reversal of the trend when and if the one time framing action will eventually interrupt or in other words when the low of a future month will eventually take out the low of a previous month.
But at the same time as you can see in the monthly chart, current month is an inside one. And this means, as I already wrote in a previous post, that balance rules will apply on a major scale. In a balance situation you could expect the following to happen: 
Now the current month range is pretty narrow and furthermore price closed just at the upper extreme of the month range and so the first hypothesis is the most unlikely. The second and the third hypothesis are instead quite probable and this narrows the field of our variables:
{quote} ....EDIT to add: I forgot to mention that in case of a first correction upside above the cluster 3065-3068 we also have a PIT poor high at 3146 and then finally a 4 PASS PIT gap at 3194-3200 Now if a gap 3 pass like the one at 2970-2975 is very rare a 4 pass gap is extraordinary rare: this means that in my opinion both of them got to be filled during a pit session before or after[/highlight]...
{quote} but it will be almost impossible to leave that gap upside, in my experience at least. So take note of this consideration because in case of a first correction upside I will not be so impressed if we will see a full correction of that gap (3194-3200) before to come down again to correct the one below (3065-3068)
See the PIT daily chart:
Now, In the same post I also stated that after the correction of that extremely rare 4 pass gap at 3194-3200 the odds should be in favor of the correction of the 3 pass gap left downside at 2970-2975. But in the mean time the market, during the correction upside, left an other 3 pass gap at 30285-30395. And this means that if the initial odds where in favor of a correction downside towards 2970-2975 now those odds are doubled.
Clearly we are speaking about odds and clearly this is only one part of the equation. So, in order to further deepen into current situation let's analyze the market in a downside perspective:
- On a monthly base we are in a one time framing higher action: this means that of the last 5 months we have never seen a month taking out the low of the previous month and in turn this means that the major monthly trend is UP. See PIT monthly chart:
Having said that generally you can begin to speculate about a possible reversal of the trend when and if the one time framing action will eventually interrupt or in other words when the low of a future month will eventually take out the low of a previous month.
But at the same time as you can see in the monthly chart, current month is an inside one. And this means, as I already wrote in a previous post, that balance rules will apply on a major scale. In a balance situation you could expect the following to happen:
- remain in balance;
- attempt downside or upside and succeed;
- attempt downside or upside and fail and then retrace to the opposite extreme of the balance and possibly continue in that direction or reverse again;
Monthly balance environment:
Now the current month range is pretty narrow and furthermore price closed just at the upper extreme of the month range and so the first hypothesis is the most unlikely. The second and the third hypothesis are instead quite probable and this narrows the field of our variables:
- We could see an attempted break upside above current month high 3210 and succeed, meaning continuation of the current upside one time framing action (upside monthly trend) eventually going to retest March 2019 pit high around 3380. (But this will leave unsolved the two 3 pass gaps left downside at 30285-30395 and 2970-2975.
- We could have an attempted break upside above 3210 and fail and this could at least open the doors of a full retracement of January range towards the two 3 pass gap gaps left downside at 30285-30395 and 2970-2975 eventually succeeding in an attempted breakout downside, below January low and towards the huge cluster of poor lows left at the base of November 2019 (27787).
- And finally we could see the second option evolving in a new failure downside meaning the interruption of the one time framing higher (because in that hypothesis we took out the January low) but at the same time the impossibility to continue downside towards November low and eventually seeing a retracement upside and a continuation of current state of balance or the development of a new trend upside.
Considering these three options I judge the second one the most probable: because it will solve at the same time the two gaps downside and the huge cluster of poor lows left by November 2019 but obviously we are speaking about odds and only the further market development will tell us if this is the case or if less probable hypothesis will instead prevail.
Ubi maior minor cessat
