Little over a month ago, a medium-term bullish triangle scenario was identified (for targets see - World Markets Update). Progress has been slow, but that is the nature of a sideways symmetrical triangle! So far, price is following the plan diligently. Here's the medium-term picture:
We're currently in Wave D of the triangle with a short-term target around 3150, and if you remember every leg of a triangle is a 3-waver. The recent dip is the 'b' wave of the D. Note the declining volume, as uncertainty increases in the sideways motion - a feature of the Triangle.
As mentioned before, the projection lines drawn on the chart are compressed, and it may take longer for the whole scenario to unfold. The very short-term chart below explains how we might finish D:
Non-Asian readers - for the Chinese, red is good. Hence red candles go up!
In this chart, a small Inverse Head & Shoulders is in the making, with a target slightly above 3150. Note the general rise in red volume, and decline in green volume - augurs well for a subsequent rise. Prices should stabilise above 3000 for rest of this week, and head higher next.
Above medium-term triangle scenario will become unlikely with a sustained break below 2900. All the best folks!
Technical view
Short-Term: Neutral, Medium-Term: Bullish, Long-term: Bearish
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