GXY (ASX) Chart

This is the chart to which I have been working. I thought I'd post it now because the days trade almost perfectly lined up with my guesstimate track. Clearly a few of us have been expecting this retrace, and we are all relaxed about it, if that it at all reassuring to anybody who just joined.

This chart has been what has been behind my comments over the last couple of days. I have mapped out what I think the track will be. Not sure whether those are prices it will reach or closing positions. I think mainly closing positions. What I think will happen is that it will open lower tomorrow but go green during the day, and probably close lower than today, BUT the following day will then be a big green candle, followed by a red candle, but higher price, followed by a couple of green candles up to 320-330 by the 19th, by which time the RSI will be about 85%

In terms of the bounce point, we are on the 38% fib now (a good place for a bounce in a rising stock), and if we open just a teeny bit lower we will hit the 59% RSI (a good place for a bounce in a rising stock exiting the 70% band for the first time this rise cycle) and land squarely in the last rising channel (a good place to pick up buyers comfortable inside the channel) AND cross the 23% circle fib retrace line (which acts as a magnet to stocks to follow it), AND there is a significant volume of buy orders defending the current point AND the consensus is for 250 to 260 to be the bottom of this range AND it is just a little early for the larger retrace. Anyway, that's how I am seeing it.

Clearly we have a declining wedge (almost - tomorrow will confirm) , and that wedge is attached to a 60+c flagpole, making it a flag which should be worth 60c from whichever point it breaks. Hence a target of 320-330, assuming a break around 260.

Of course, it could also be that this is the start of a more major retrace and will need to wait a month for the annual Feb SP climb, but I don't think that is the right fit for this year. No proof other than instinct. If this chart is wrong, tomorrow will stay red. It will be hard to pick it until later in the day. It is also possible, but unlikely, that tomorrow will open higher, but I am not so sure it will reach my target of 320+ by 19 Jan with that pattern. I'd need to think about it a bit.