Bullish Signals Flash: Stocks and Precious Metals Analysis
Today was another positive day in the PM complex and the US stock markets which shows risk on behavior. Some may not agree with me, but I think there is a lot of capital sloshing around looking for places to go and small portion will find its way into the big cap PM stocks and even the juniors and micro caps.
Lets start with this daily chart for the CDNX we’ve been following pretty closely since it began the bottoming process about a year or so ago. The CNDX is the Canadian venture index where many of the junior and micro caps are located.
After putting in its 4th reversal point back in April the CDNX has moved restlessly high pausing at the breakout of the top trendline for the backtest. Next came the first impulse move since the breakout where today the price action broke out from the flat top expanding triangle with a breakout gap. A small pattern like this is exactly what you want to see in a strong impulse move. We could see several more small consolidation patterns like this form before a larger consolidation pattern starts to build out.
Below is the three year double H&S bottom with almost perfect symmetry as shown by the neckline symmetry line with two left and right shoulders. If you recall I called this chart the clean version which is just stripped down to the minimum. We also looked at the possibility for reverses symmetry to the upside over the same area on the way down as shown but the black arrows. So far we couldn’t have asked for a better outcome.