Hi all. There's often an explosive move once a Volatility...

Hi all. There's often an explosive move once a Volatility Contraction Pattern like this wedge/symmetrical triangle resolves and, well, err...BOOOM? . Price "jumped the creek" as our Wyckoffian chartist friends would say as it gapped up to open just above the recent high of 0.885 and totally avoid battling through the known area of supply- the volume shelf between 0.85 and 0.875 I mentioned last night, which now sits nicely as support. That's one way to deal with resistance- jump over it. But despite what I said about there being very little past trading to get in the way of a decent move up above 0.885, I was still on high alert for a deep sell-off- we've all seen that too many times before across many stocks- but it never came.

In fact it was a really strong day setting an ATH and closing really high on the bar and about the only box it didn't tick was actually closing above the previous ATH, but to be fair that wasn't seriously on my radar yesterday. But we now have a simple measured move target from the break-out of the wedge at about $1.16, as well as any other targets our Fib, Elliot, Point & Figure and other friends in the dark arts come up with. All which leads me to think that there's a good chance that today's gap is a breakaway gap- "never" to be closed. Yes yes yes it will need to confirm and there's a good chance that there will be some sort of retracement while this up move gets going, but there's a few bits of evidence that suggest that any pullback in this area will be a lot more shallow than a dive down to close the gap. I mean, it would take some pretty bad news or event to smack price down that hard after such a text book build-up and great follow-through. And given the extremely stable world economic, social and geo-political environment we are now in, that's highly unlikely right?

Something I found interesting today was how "precise" trading was and so following the daily chart below is a 5 minute chart to show you what I mean.



I really only venture below the daily chart to tighten things up occasionally, but sometimes it's a bit of fun to get forensic and check out how the daily bar was formed. Below is a 5 minute chart for infotainment purposes to show what I meant by how "precise" trading was today along with some other observations.

• Notice how quickly after the open price came back and tested the 0.885 level precisely.
• Price hit 0.94 several times in the first hour and a half and formed a flat top and created the top of a volume shelf at the same level, which does not always happen. I think someone else today noticed this pattern as a little cup and handle- fair enough - but notice later in the day when some stopping volume came in at precisely 0.94 to send price sideways.
• If trading continues to behave so precisely, the levels to watch below for a bounce will be 0.915 then 0.885 again, but it would be much nicer if price got above 0.965 and that became the level that was tested precisely later on.
• So I guess I'll see if the market ends up doing precisely the opposite of what I'd like it to do!

Good luck all, Rooster.