Price has resumed its uptrend and last week’s sideway move is likely a short term consolidation. Based on current trend, price should break up and even a break down may not be enough to change current picture.
The new all time high printed signals good resumption of trend as: 1) stays above 08 high for 2 weeks now, 2) RSI also moving above consolidation high, and 3) price again hugging the Bollinger band.
We believe price may trade higher following last week’s consolidation given the current uptrend, also higher lows printed every two days, Monday, Wednesday and Friday and daily stochastic is still in buying mode (chart 2). Price touching 1600 is possible given consolidation range of around 20 pts.
However, short term strength may sizzle if price trades and especially a close below 1566. Support likely come at 1555, likely a mid cycle bottom, as it recorded the lowest RSI since late Dec (chart 1). Support area maybe around 1520-1545, the 62% and 38% Fibonacci levels of current rally.
Note too that the 28 day cycle may still be in play and now we are at day 19. Therefore a break up may last for another week while a break below likely see price bottoming in about 10 days from today.
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