In my last post I described how I thought there would be another test of $50 within the next day or two. Well we did get that test but obviously have failed to break through. Heres the 10 day chart.
The trendline which I’ve been looking at is drawn again here, I’ve also added some upper and lower parallel lines in at levels which look like may have some validity.The trend line held until we approached resistance near $50 and then there was a large move down through the line all the way to the mid 30’s. So much for my fear we wouldn’t see those prices again! although you had to be pretty quick if you were a buyer there.
Will there be a third attempt to get up to $50 and through that to new highs? I’m watching closely for signs that the lower line I’ve drawn might provide some support around the $44 level.
Heres the 2 month chart again for a longer range perspective. We are still well above the old channel which we stayed in for the last 2 months. I would guess there will be solid support at the top and bottom of that channel if we do drop that far.
At this point I’m still thinking that the bull run is intact, in fact picking up steam. If we get through resistance at $50 we can go a lot higher yet, maybe up to $200 or something in that region. If $50 proves too tough to break through we may languish in the longer term channel we are in which has a floor at about $20 currently, personally I doubt we’ll ever get that low again though.