- Pole & Triangle formation showing a strong potential rally is on the cards.
- Gaussian channel providing long entries on pullbacks for bulls.
- Macd confirms a period of consolidation.
Pole & Triangle:
There was a strong rally before the triangle started forming. During this period of consolidation (Triangle), price has moved sideways, and this is a good sign for bulls. Now as the sellers reduce their positions, the market prepares for a continuation rally if the fundamentals align.
Im not going to extend a price target since the Triangle has not been broken and still has a chance of breaking to the downside. Price is likely to continue testing the lower range of the Triangle at $33,200 and the upper range at $34,200.
The Gaussian channel is proving to be a strong support channel as price retraces into the zone. Traders can monitor this for potential long entries.
The macd has ‘squeezed,’ and the histogram is very flat. This is a strong bullish sign after a powerful up move because it suggests a coiling up period where price could spring out and continue with the prior trend.
YM diverged for the majority of last year compared to other indices. Price is stuck within a range that range-bound strategies can take advantage of. At the moment, the industrial average is still bullish in its medium to long-term outlook.