Since you have mentioned this chart. I might as well put this up and share some knowledge with our fellow viewers. [DYOR, not financial advice]
$CAE, This stock you mentioned went 10x in 2 months [Sept to Nov 2021] (post bear trap/accumulation in awareness phase -> mania phase -> blow off phase)
In this case, I do agree on a capitulation is coming even if there isn't a market collapsewhen you come off a blow-off top and hit to/below the 62 fib from the top. Some examples would be $BRN from Jun to Sept 2020, $VUL from Nov to Jan 2021, $IOU Feb 2021
However, when compared to QPM that nearly 15x in 1 year [Oct 202 to Oct 2021] (take off -> first sell-off).
1. QPM didn't end up with a blow-off top but a head and shoulders pattern (HnS).
2. While typical Hotcopper was in the euphoric moment when QPM hit 28c, QPM valuation isn't actually on the mania phase. I believe we only hit the peak of the Awareness phase (I will admit though the take-off was arguably a bit parabolic).
3. Ok, since QPM played an HnS, what are the chances of it actually hitting the 62 fibs (0.12)??
According to this article it indicates a strong reversal at the 200% fib
Now look at the chart below, on the left is potential 62 fib from the top (12c), on the right is the 200% reversal extension for the HnS.
The reversal ended up at 0.160-0.175; almost bang on.
Some crystal ball questions for QPM [DYOR, not financial advice]
1. Would the price potentially falls lower than 16c without market capitulation at this current period? -- given the current circumstances its still too early to call, unless the US market begins capitulation.
2. Would it drop to 62 fib due to market capitulation? -- Possibly.
3. What if a futureswing high does not break 0.28 even without market capitulation? -- Now it's is possible to retrace back to the 62 fib (0.12). Assuming 0.16 is the bottom of this fib extension. But again, this normally would coincide with company fundamentals (eg. Funding issue, project delay, production delay, plant construction delay, management incompetent, etc) or if the market is not expecting significant news for a long time.
Again I am no expert but this is what I think is playing right now, please DYOR.
