The rebound has gone a little beyond our guess of $65 and has taken longer than what one would normally expect at seven months. Nevertheless the outlook remains the same. Any moment now we should dive down again by about $30 but probable a lot more than that. So you have $5 to the upside and $30 to the downside and both the RSI and MACD have turned decidedly bearish. A short perhaps?

On the left, we called for a top just about a year ago at $78, give or take. It immediately plunged about $30 or almost 40%. Then we looked for a rebound to about $65, it went a little higher (see all blogs). Here we are having completed either waves 1 and 2 or A and B. Next is 3 etc. or C.  The 4th wave of previous degree is around $25. You just cannot take the chance! Here is the rebound illustrated to save you time, this was as of Sept 2015.

Open Text has followed our script rather precisely, please see previous blogs. We have a nice initial 5-waves down and have nearly completed the first retracement. This may go as high as $65 but we would certainly not wait un till the last moment, in fact we really would not wait at all! From here, or a little higher, we expect wave 3 ( or C) to start and drop towards the wave 4 level of previous degree, that is to about $25. That could be all there is if this is an A-B-C zig-zag correction. However it could also be just part of an initial 5-waves down for a much larger A.  In practical terms you do not want to stick around for a $40 drop.

The usual then, Jan. 2015, and now charts;

Here again we had a wedge, possible also a thrust from a triangle. It looked like the top was in already in January but that , with the benefit of hindsight, was clearly wrong which often happens with these wedges as they should contain 3-wave legs but any two of those is itself also a 3-wave leg. In any event the harm was minimal as the stock only went a dollar or two higher. It would have allowed for a better exit. We still fully expect the stock to reach about $50, the base of the wedge (and the low of the triangle). Then after a solid rebound of $10+ another leg down should start. Wait for the rebound to sell if you have not done so. For those so inclined it should be a tradable bounce.