chart- volatility momentum telling a story?

Hi friends,

I'd like to share a chart of CIG showing the price bars enclosed within an envelope band so that we can get an indication of the volatility and its effects. There is ZERO fundamental content in this post.



As you can see from the chart attached, the price bars have fallen to the lower bound of the band envelope where the price bars are within a narrow constriction of the band, indicating a tightening of volatility. Small range bars are followed by large range bars, and with this constriction in place, further volatility will cause the band to expand and prices to improve.

Below the envelope band chart, I've drawn a momentum indicator of CIG. The past entries and exits were reasonably well identified from this momentum chart, as are indicated by the yellow circles and the vertical lines I have drawn to correspond the momentum to the price signals.

One interesting thing I observed is that there is a possible and imminent momentum entry signal as at yesterday...indicating we are at the throes of a price movement upwards soon.

May the best prices be yours,

dascore