XLE a W3 BO of 2GANN FAN lines+wedge move or a bulltrap to W4?
Updated
XLE formed a big H&S pattern in 2002 & has since bottomed during pandemic. From there, it started a blue rising wedge which had a more chance of breaking down. However, due to the Russian invasion, it broke to the upside above the H&S green neckline.. Measuring the height of this wedge gives a target of 82.40 which XLE had reached & recently exceeded. It also exceeded 2 GANN FAN lines from 2002 & 2020 lows but registered a big red candle the next day.
I think XLE is currently at an impulse wave 3 of 3. XLE must hold 79 for wave 3 to continue higher. Losing 79 may signal a corrective wave 4 of 3 back down to retest the wedge at near the 68 level before a wave 5 0f 3 starts. It may even retest the green H&S neckline started in 2002 approximately near the 66 level.
Supports at 79, 68 & 66.
Resistances at 88 (1.618 Fib) & 92.24(2.0 Fib of recent wave b in a zigzag move)
There is better chance of XLE holding 79 with wave 4 & do the last wave 5 of 3 as the world energy crisis is not abading in the near future. XLE is the ultimate winning sector for months.
Not trading advice
I think XLE is currently at an impulse wave 3 of 3. XLE must hold 79 for wave 3 to continue higher. Losing 79 may signal a corrective wave 4 of 3 back down to retest the wedge at near the 68 level before a wave 5 0f 3 starts. It may even retest the green H&S neckline started in 2002 approximately near the 66 level.
Supports at 79, 68 & 66.
Resistances at 88 (1.618 Fib) & 92.24(2.0 Fib of recent wave b in a zigzag move)
There is better chance of XLE holding 79 with wave 4 & do the last wave 5 of 3 as the world energy crisis is not abading in the near future. XLE is the ultimate winning sector for months.
Not trading advice
Note
Pls forgive me for the error. The measured move of the wedge BO should be 82.40 & not 85 as shown in the chart. Watch out for the 79 to hold as it is a stronger & a far more obvious support that many will be waiting to buy on bounce.
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