Despite the broad interpretation of the past weeks as nothing more than a descending triangle (understood to be a bearish signal), the price action has clearly left the consolidation phase and a new rally is underway. The old bull channel trend lines from weeks before are still visible in the incline of even the small rallies within this consolidation phase. But the biggest indication that we are not immediately due for a major selloff is the extremely long amount of time we have remained at this support level. There is no other period since the November rally than can compare in terms of horizontal support and stability over such a long period. Thus, we can expect confidence in this new floor will lead to a new bullish breakout at any moment.
Despite the broad interpretation of the past weeks as nothing more than a descending triangle (understood to be a bearish signal), the price action has clearly left the consolidation phase and a new rally is underway. The old bull channel trend lines from weeks before are still visible in the incline of even the small rallies within this consolidation phase. But the biggest indication that we are not immediately due for a major selloff is the extremely long amount of time we have remained at this support level. There is no other period since the November rally than can compare in terms of horizontal support and stability over such a long period. Thus, we can expect confidence in this new floor will lead to a new bullish breakout at any moment.