It took four years for the price to reach the current level of 72.85 after a primary downtrend. The previous week’s candle has given a strong breakout of the resistance line at 70.1.
As a result, we can conclude that the price can only continue to rise above 70.01 if it remains above that level. The current breakout attempt is stronger than the eight previous candles, so it’s not unusual to expect trend continuation.
Let’s check the lower timeframe to get more shreds of evidence.
LEMONTREE has been forming in the parallel channel for more than two years. Bulls and bears agree with this channel because we can see only a single excess on the upper and lower bands. After forming the second excess, the price hasn’t moved outside the parallel channel.
Price has formed a consolidating range of 70.9 – 58.4 for four months, which will be a good opportunity for the traders.
We can set our targets up to the upper band of the parallel channel. Traders can extend their targets up to a new high after the breakout of the upper band of the channel.
I have zoomed in the value area of 70.9-58.4.
Here are some points to consider:
- Price has taken three touches at the upper band and lower band. None of the six touches move outside the range, and reversal occurred on the form on the tail.
- The 7th touch has moved outside the parallel channel.
- Price has broken out the average volume line and four-year-old resistance level.
- There are 11 touches on the control line of the parallel channel. The final touch has boosted the demand pressure.
- Price is above 200 EMA.
If the price sustains above 70.9, traders can trade the following targets: 86 – 93. Note that failure to sustain may cause a range-bound move.. After the breakout of the upper band, we can extend our target to
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