Hi all, price is at another interesting spot at the moment- time for it to show us what it's made of!
It's sitting a smidgen above the 50EMA and threatening to break above the short-term down trend line, which could attract more buying from break-out traders. This current up leg has a much stronger "background" compared with the previous short rally a month ago, with the ultra-high volume bar on the 5th showing strong buying to stop and then reject the down move with a close well off the lows. Selling just didn't follow through after that and should provide some confidence for bulls to push higher.
Weighing against that is that some supply appeared today to effectively absorb the buying. Despite about the same high volume as a couple of days ago which had a 9c rise, today could only mange 1c. It's hardly a surprise as price has just re-entered a volume shelf- a zone of previous high volume trading- a previous battle zone, so there's a chance price churns within this zone for a little while, before breaking out- hopefully to the up-side. But it's only one day of supply pressure and we need to see the response over the next couple of days to get a better picture.
It would be really interesting to see what happens if demand could step up and quickly push above the $2.62 level. Price has already swept through this area and immediately above over the last couple of months, so potentially already removed a lot of potential supply, so the momentum could quickly carry it to challenge the $2.90 level again. That would be nice, but I think more realistically that as it rebuilds some strength, we could see a new higher low form before we see the next higher high. And that's OK, the chart would then be forming a smile, and that's always a good thing.
Good luck everyone.
GXY Price at posting:
$2.51 Sentiment: Hold Disclosure: Held
