ERY broke out of it correction Friday, and may wish to continue its climb today. It approaches to lower channel line, so an answer should come early. Note, the Bollinger squeeze and head fake annotated on the graph. Note, too, On Balance Volume and Stochastics also confirm the assessment. 
ERX confirms the movement of ERY. The possible alternative assessment of this movement is that we have merely completed the A and B legs of an ABC correction, and the C leg will now follow taking ERY down again, perhaps actually reaching the 38% retracement level missed during the first attempt. If that is the case, we should violate the lower channel line (black) and the trendline (blue), and do so early. 
Of course, a third possibility is that this correction could simply continue sideways. No one promised simple. Fortunately, prediction is not required; one simply need react to whichever occurs and place a nearby stop loss should the trade go adverse. It is playing the odds, not fate certain.One aspects of ERY continuing upwards, is that the correction of the last Wednesday and Thursday forms a flag, which Friday was confirmed with a breakout. The question now is whether the upper boundary of the flag will be retested or not. If this is the correct interpretation, the price target should be approximate 24.50 and should be reached this week.
Hello. I'm also in ERY over this long weekend.
ReplyDeleteHere is what I want to tell you.. apply your TA to the "subject" with these ETFs. You will have greater success. Chart the $RIENG index, Russell 1000 Energy. It determines all pricing of ERX/ERY. The index is what you want to chart.
Pay no attention to ERX/ERY prices, just the determining index. Then place market trades accordingly.
Same goes for all of them.. for example, FAS/FAZ you would chart the $RIFIN, and for SRS you would chart IYR.
The support/resistance levels are valid this way.. try it.. you will see..
Ron.
Thanks, Ron. I'll definitely give it a try. Ran
ReplyDelete