Thursday, January 19, 2012

6E - Divergences and Fibs on 4h/Daily/Weekly


6E has been in a long downtrending channel/wedge for several months as it made lower low everytime it tried to bounce continuing to build positive divergence. Daily and 4hour charts show this diverging action, and finally on clear 4hour chart positive divergence and supportive daily chart, made upmove breaking out of the declining resistance trendline. Notice the fib extension and fan lines in play on weekly chart. As the weekly stochastic has just turned up, it is possible this could be a substantial reversal as the market moves in cycles.

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