(Click on charts to enlarge, then click again for further enlargement. Use back arrow at the top of your browser to return to the narrative).
There's an explanation of overhead supply written on the chart, for easier reading, as well as the numbers for key support areas.
After a short-term rally of roughly 8% (the red arrow) and a rally of nearly 20% off the 46.20 March 10 low, I like seeing this period of consolidation, otherwise the stock is in danger of a parabolic blowoff, meaning that it goes straight up without building any kind of chart structure. Those often result in Ye Olde "Parabolic Blowoff...Parabolic Return" to the origin of the rally, and often below that, as witnessed recently in AMZN (see chart below).
Basis this 10-Minute chart, The Bulls attempted to break out of a Symmetrical Triangle (the thin white line was the bottom of that pattern), but The Bears were able to break it to the downside heading into the closing bell. The Bulls would like to "morph," or change, that broken Symmetrical Triangle into a Bull Flag, having established White Data Point #4 on a Bullish Hammer in the final candle of the session.
The three white arrows at the top of the pattern are trendline validations. Ms. Market told us quite clearly, "YES! That IS resistance!" When validated trendlines get taken out, that usually has "some" significance. The high of the third trendline validation was 54.84, so The Bulls want to take that out to the upside. That would put the recent high of 55.25 IN PLAY, as well as a measured move of about 55.58 IN PLAY.
Math:
55.18 - high of the pattern
54.39 - low of the pattern
55.18 - 54.39 = 0.79 points of upside added to a breakout near 54.79 = roughly 55.58 IN PLAY (depends where it breaks out, if it does).
FCX currently is indicated to open down a bit, at BID: 54.50...ASK: 54.51
Example of a "Parabolic Rally...Parabolic Return."
5 comments:
Excellent chart and commentary imo. Thank you so much. Look forward to your posts.
Thank you very much, Mary. It's nice to know if someone finds it useful. I have a hard time getting it all written out in a manner that doesn't take so much of my time, but it's hard to tell what level of experience readers have, and how much detail is "way-y too much detail." I tend to over-explain, I think ;)
I know what you mean about explaining, but it is much better to over explain than to assume someone knows to me. I think you are a most gracious teacher with your time and talents. I know it can be exhausting as well though. I really relate to it so I am prejudiced:-)
Thanks again!
Thanks for your understanding, Mary. I guess part of the problem is that it isn't any easy subject to explain. It takes a lot of study and practice ;)
If someone is interested in TA and is a student of it, your comments are plain as day :-). Yes, someone needs to be on the "path" to know what you are talking about . .but that is good. You are helping those already committed to understanding TA improve their skills. It is like you teach college instead of first grade :-) I don't want to read first grade material . .and that is why I like your blog :-).
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