This pullback in the materials sector is still in the healthy range. Don't be stressed about these wild swings in the IOP, it can go up as fast as it goes down, and in the big picture, we're still in a long-term uptrend. However, as I've said before I think we have further downside/consolidation. The reason I say this is because Friday's bearish engulfing candle does not indicate a bounce anytime soon, also, my analysis of IOP indicates a turn in IOP around the end of May which would coincide with both XMJ and XMM
On the XMM we're at the key natural support level of 3,400 and I believe we may head lower to test the 3,300 level.
(support boxes are calculated from confluence between various extensions, retracements, and natural levels)
XMJ paints a similar picture
If you're still worried, compare this pull-back to the one the same time last year which also begun to turn up around the end of May.
Furthermore, if you're a student of Elliot Wave Theory, you will notice we're on the 4th wave and it's possible for the 5th to push us up to the purple target box.
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