Within a MAJOR UPTREND this NYSE listed Global X LITHIUM ETF , after last weeks breakout has a new tentative bullish price objective that we will look at. In 3 Box PnF charting Quintuple TOP BUY or Quintuple BOTTOM SELL signals are extremely rare. Think about it in bar/candle chart terms as a resistance area which was overcome after 5 tests. If I see three failed tests, I personally think of a potential failure at that level. This beast (LIT ETF NYSE) did not and on the fifth test it cracked it with a very strong breakout. Whether or not this breakout holds is another matter off course. In hindsight we will know since we only deal with probabilities in charting.
To the newly emerged vertical count and to the bullish tentative price objective from it. Although Richard Wyckoff had not used vertical counts to obtain tentative price objectives there is no reason that we cannot do it. Vertical counts are as good as horizontal and are also as accepted today amongst the TA community. If the professional charting software package at StockCharts.com uses it ( vertical count) with all their technical expertise in the field of TA, as it is shown on the chart, why can’t we ? That is what I did and what I also do. This doesn’t mean that I ignore horizontal counts. Both are equally as good in my book.
I will also in the absence of a notable O entry column in the pattern take a horizontal count which is also shown on the chart.
One may take the average of both counts if they wish.
Sector rotation does evolve at various stages in the stock market in different time frames ( short, medium or long terms) as it was keenly observed by RDW back at his time as does now. This LITHIUM BULLISH stance when broader markets are at a standstill ( flat) may well be one of those.
As most of us may know ATAA has a new National President. The IFTA CFTe program I believe is about to be re instated again. How nice this would be for those of us looking at learning TA, the proper way. Also, Warren gets the thumbs up from me for his efforts in restoring member confidence which may have diminished. If you are not a member of ATAA may be worthwhile looking into it.
Chart is courtesy of StockCharts.com
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