For those of us who are not familiar with the technique, just read the following commentary, which I will keep simple. But in short, why 1 Box PnF chart ? To help me with my analysis uncovering the whether or not the current trading range may turn out to be an accumulation or distribution. Until such time that it resolves itself decisively we don’t know what it may be. This is a fact.
RDW ( Richard D. Wyckoff) legendary trader analyst from the Golden Era of TA used 1 box point and figure charts to help him identify the potential outcome of the trading ranges and this is what I am trying to do here being one of his life long students.
Analysis Summary: Within a down trend GDX.ASX ETF has entered into calm waters without volatility. Range bound between approx. $27.00 and $29.50. See the boundaries drawn with Green support and resistance lines. Bearish price objective from the 3 box chart (not shown) was $29.80 which has been exceeded slightly. This coupled with the current price action behaviour (calm without volatility) may suggest potential accumulation trading range which is yet to be resolved and confirmed. This is my view and I will keep it at this with further updates to follow as things change/unfold. Duration of the trading range ? I don’t know the answer to this. But, I suspect by early to mid Jan. we may know. It is a relatively small trading range so far. Longer it goes, the greater tentative price objective we are likely to get, bullish or bearish.
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