A weekly chart of XAO is used with this analysis. Price action has established a tentative UP TRENDING Channel with it’s boundaries within the Overbought and Demand lines drawn in Green. A Sign Of Strength Rally (SOS) on hand as mentioned previously, which may also be seen as the final stages in Phase D of Wyckoff Accumulation. A potential BACK UP (BU) or PULLBACK to retest the Demand line is likely. We should also highlight the moving average bullish crossover marked as XO (not French Brandy) on the chart.
There is NO SHORT TERM BEARISH REVERSAL which may suggest a corrective period in the form of a Pullback or Back Up).Therefore I am treating this price action behaviour of the last 5 weeks as FLAT CORRECTION until proven otherwise. We may have a complex bearish PIVOT POINT over the coming weeks which may suggest a PULLBACK, but there isn’t one as of this writing to suggest that.
In summary, XAO is ticking along nicely within a tentative up trending channel, in Phase D of Wyckoff Accumulation. All eyes are on this Brexit Business now.
The biggest clue of this pattern being an accumulation rather than Re Distribution was from the TENTATIVE BEARISH PRICE OBJECTIVE which we had form the PnF Chart. Any practitioner/student of Wyckoff Method which does not employ PnF in their tape reading are missing out on the 3D effect which PnF brings in IMO.
That is why, it is important to follow and learn form a true educator like Prof. B.Fraser who employs the PnF charting in Wyckoff. His blog at StockCharts.com clearly demonstrates the importance of PnF in Wyckoff.
Enjoy your weekend.
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