Mystery Chart 11-25-2019

JC Parets
November 25, 2019

From the desk of Tom Bruni @BruniCharting

New Mystery Chart!

For those new to the exercise, we take a chart of interest and remove the x/y-axes and any other labels that would help identify it. The chart can be any security in any asset class on any timeframe on an absolute or relative basis. Maybe it's a custom index or inverted, who knows!

We do all this to put aside the biases we have associated with this specific security/the market and come to a conclusion based solely on price.

You can guess what it is if you must, but the real value comes from sharing what you would do right now. Buy, Sell, or Do Nothing?

Here's this week's chart.

As we can see, prices have been in a strong downtrend with momentum in a bearish range. After reaching our downside price objective at the 261.8% Fibonacci extension of its pre-decline consolidation, momentum began diverging and prices found their footing.

Now the question is what are we doing as prices approach a downward-sloping 200-period moving average and overhead supply at broken support? On the plus side, momentum has gotten overbought which could mean we're in the process of transitioning from a downtrend to sideways.

Click on chart to enlarge view.

To me, this looks like a counter-trend rally within a structural downtrend and is worth selling into as prices approach an area of potential overhead supply. Take the entry and see how it develops.

But what do you think?

Tweet me @BruniCharting or email bruni@allstarcharts.com and check back in Wednesday to find out why this chart is relevant.

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