Oil Price Channel

Oil is Working its Way Neatly Down the Blue Price Channel

Oil is Working its Way Neatly Down the Blue Price Channel

Oil is working its way neatly down the blue price channel. It’s either maxing out the channel waves before starting a megaphone bottom (green scenario) or its in the middle of a falling wedge (purple) or falling megaphone (orange) bottom already.

We’ll know which it is by when it first breaks the channel top.

Oil's Next Move Could Be to the Orange Megaphone Top or Oil Could Return to VWAP at 50 and Start a New Megaphone There

Oil’s Next Move Could Be to the Orange Megaphone Top or Oil Could Return to VWAP at 50 and Start a New Megaphone There

Oil has already done its job of confirming the orange megaphone by taking out the August 2, 2016 low.  It’s next move could go all the way for the orange megaphone top.  But oil could also return to the orange megaphone VWAP at 50 and start a new megaphone there.

If oil is going to go for the orange megaphone top, it will likely attempt a megaphone across 50 that breaks out in a Sornette melt-up set-up without a retrace to VWAP.

A series of megaphones inside megaphones across 50 would imply that oil is turning the inverse head and shoulders on the chart into either an inverse head and shoulders with a triangle right shoulder or a large triangle that will eventually break out downwards.

The inverse H&S with a triangle right shoulder is more likely, and would lead to a large move up on breakout.

QQQ Bounce

QQQ Just Bounced a Second Time Off the Bottom of its Blue Rising Megaphone

QQQ Bounced a Second Time Off the Bottom of its Blue Rising Megaphone

QQQ bounced a second time off the bottom of its blue rising megaphone on Friday. That’s fussy trading.

A genuine breakout through 141 means another new high. Otherwise QQQ is stalling, forming something like a triangle before the trip to the red rising wedge bottom, a bounce there, and breakdown to at least the mandatory retrace level of 105-106.

Gold Textbook Triangle

The Blue Megaphone and Pink Rising Megaphone Lock Gold Into a Textbook Triangle Scenario

The Blue Megaphone and Pink Rising Megaphone Lock Gold Into a Textbook Triangle Scenario

Between the pink rising megaphone and blue megaphone, trading formation rules now pretty much lock gold into a textbook megaphone-inside-megaphone triangle scenario.

An upwards breakout from the red triangle would be an upwards breakout from an inverse head and shoulders bottom with a triangle right shoulder.  The technical inverse H&S target would be at least 1800 but the long move sideways would imply a new all-time high for gold.

Gold Long-Term Rising Megaphone

Gold Long-Term Rising Megaphone

An upwards breakout would usually mean gold was extending its long-term rising megaphone (blue in chart above).

A downwards breakout, which is more likely, would target the 700s and likely lower in the course of forming a bottom.  A downwards breakout would complete the blue-rising megaphone with a retrace to its bottom.

Gold Still Heading Up

Gold is Putting in a False Top Near its April 17 High but is Highly Likely to Go Higher

Gold is Putting in a False Top Near its April 17 High but is Highly Likely to Go Higher

Gold has formed a new megaphone across 1250ish and has reached the level of the previous April 17 high within this megaphone. A price would often put in a false top here and retrace as far as VWAP at 1250-51ish before heading up to a new high for the megaphone.

The pink rising megaphone on the chart strongly suggests gold will head up to at least the top of the potential red triangle (that triangle bottom is likely to be redrawn).

If gold makes it as far as the blue megaphone top I’ll be redrawing the most likely scenarios.  Right now the green is such a strong favorite I’m not cluttering up the chart with others.