Short Term Rally Officially Over…Almost
Taking a look at the daily chart today paints a pretty bleak picture for the current short term rally. Although the rising triangle support line hasn’t been broken, all other signals are pointing to a downside breakout.
Today’s price action formed a bearish englufing pattern on the candlesticks, and the Williams %R is flashing a new sell signal. Price has attempted to cross the 50 day ema for 7 straight days, only to come crashing back down.
Looking Forward
There is still very little confirmation in the chart in terms of volume. The current rising triangle pattern is looking a over extended, and unless a breakout happens in the next day or two, the pattern will become invalid.
My hunch is that tomorrow or Wednesday we’ll see a downside breakout on high volume which will confirm this ascending triangle is actually a top triangle, and with the next support at July lows around 10,800.
Here’s the chart
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