Tuesday Summer Solstice 2011
Price shot up quickly on Tuesday, slicing through the half-way
retracement resistance area of 1287, and there was no give-back
in the gain, a show of strength arising from weakness. A buying
opportunity may be at hand. While the daily chart from yesterday's
article was not the strongest formation, we qualified the analysis as
hinging on the weekly chart, where the trend was clearly up.
[click on http://bit.ly/kGfEfS]
Price did not stay within the trading range, absorbing the selling of
the past month. Instead, it rallied straight up and stayed above the
When a buying opportunity presents itself, it becomes more
imperative to look at the smaller time frames for timing of entry.
What we want to see now is a retest, one with smaller ranges
and lower volume, to indicate that selling pressure has dried up.
Of course, if the next retest shows larger range bars down and
increased volume, at the same time, the market will be saying
that more work needs to be done to absorb the sellers.
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