Weekend Charting and Chat - 12th August 2016, page-3

The XJO closed higher on Friday
Spread narrowed, but volume increased to above average, and the close was about midbar.
There was no downside follow through after Thursday's bar (which had responded poorly to Wednesdays bar), so we continue to trade sideways in a range, until price can breakout above the thin green box above, or breakdown through the purple and green lines below.  There is supply present on the chart no doubt, although it doesn't seem overwhelming so far, and it appears the Index is working through the absorption process to remove it.  Moving sideways in a (boring....) manner like this, where there is little or no downside follow through to potential weak bars, and little or no upside follow through to potentially strong bars, is a general sign of the absorption process.  As opposed to the higher volume, and wider ranged flailing around, which is more common at significant highs and lows.


cheers