Written by Lance Roberts, Clarity Financial
– – This Post Authored By Jesse Colombo
On Thursday, I wrote a brief piece called “Watch These Triangle Patterns In Stocks And Crude Oil,” in which I showed chart patterns in those markets that likely indicated another major move upon a break-out from that pattern (either up or down). Here are the updated charts after Friday’s powerful surge in stocks and crude oil.
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The SP500 successfully broke out of this pattern:
The Nasdaq 100 also cleared its triangle pattern thanks to strong tech stock performance:
Unlike the stock indices, WTI crude oil hasn’t broken out of its triangle pattern yet, but did have a strong day on Friday (up 3.33%):
The technical picture certainly looks strong for now, and I am watching to see if there is follow-through next week (as confirmed by price and healthy volume). Also, it is important to beware of the risk of a head-fake after a breakout from such a perfect pattern as this. The “smart money” sometimes uses obvious-looking patterns like this to suck retail traders in, and then run the market in the opposite direction. I will continue monitoring the situation and providing updates.
