Sell WFC

WFC chart looks bearish.

It has advanced about 400% from the March 09 lows. Though today it is about 375% from March closing low at $8. Lets look beyond their "earnings", "profit" and "losses" and see what the collective will of investors/trader tells about the price.

Volume: Volume increased in March sell off and was heavy during the initial advance. Accumulation did take place. Since July volume has been lower compared to previous 6 months.

Momentum: Momentum is waning. RSI failed to reach 70 on past two rallies. Its latest bounce from 40 level signifies that the bullish conditions prevailed. RSI breaking below 40 will confirm that the bear is back.

EWP: The advance from March is tracing out 5 waves as marked on the chart. As per Elliott Wave guideline of equality wave 5 is probably going to equal wave 1. That means wave 5 is over and now we will see a 3 wave a-b-c decline. One of the targets of the decline is previous 4th wave area at $22.50. There is support at $26 too, which may the bounce of b wave. The structure of abc correction needs to be observed as it unfolds.

Alternatively, wave 5 can also be 1.61 of wave and can take the price action to $37.50. At that point (or slightly below it) wave 5 will be equal to wave 3. If wave 5 exceeds $37.50 then the count is wrong.

In either case, presently the momentum and volume does indicate that wave is over. We will stick to that until proven otherwise.

Candlestick: The market has two hours of trading left and anything can happen yet. So far the price is chalking out a "gravestone doji". You know what it means; the death knell.

Going short or buying January puts seems to have good risk reward ratio.

Stop loss is at $31.54; exceeding the recent highs.

Initial target is $26, thereafter $22.50.