xjo - weekend charting and chat -04 april 2014, page-26

Hi V8,

Technically, I don't think that pattern you've identified should be classified as a "rising wedge". The duration is too short. In which case, it's a pennant.

The problem with that is - the short "flag-pole" leading to the pennant. It's short in duration and extent. Compare the height of the pennant to the height of the flagpole leading to the pennant. The pennant has already retraced more than 2/3 of the pole. Plus, the duration (time) of this pennant is already longer than the pole.

Pennants perform best when they are "high and tight" or "low and tight" (bearish), i.e., the length of the pole and its duration when compared to the pennant is disproportionately large.

If you look at the chart (below), you'll see I've marked some support lines. Over on the left of the chart is a congestion zone - a likely support zone. Friday night's action took the chart back to the top of that congestion zone.

As you point out - indicators have rolled over, upside momentum is weak. So there's probably something more to come of this to the downside.

Personally, I think the current pattern is a part of a complex, slow, meandering movement with a downward bias.

:) You won't find that pattern in any TA text book.

Trading is all about stepping into the abyss. There are no guarantees. What's important is good money management. Let winners run - and cut losses quickly.

Best of luck

Redbacka.