Platinum Triple Bottom (D)
Created on Sunday, 20 September 2015 02:49
Written by Austin Galt
Platinum has just made a triple bottom formation. Now, we know triple bottoms rarely end trends so let’s take a look at the daily chart to surmise what is likely to occur going forward.
PLATINUM DAILY CHART
We can see the triple bottom formation denoted by the numbers 1 to 3. This is coming after an extended move down so while triple bottoms generally don’t end trends I doubt we will see another solid move down from here. Not yet anyway.
So, what do I expect?
I favour a bullish quadruple bottom to form which will require one last test of the low which stands at $945. We may or may not see a marginal false break low but I expect price to find solid support on the next test before a big bear rally kicks in.
The RSI already shows a triple bullish divergence while a marginal false break low now would likely see a quadruple bullish divergence set up.
The Stochastic and MACD indicators both have a bullish bias so we may see price nudge a touch higher over the coming days before heading back down to test the low.
The Bollinger Bands show price is now at the middle band but I doubt price will get back to the upper band unlike price did after making a double bottom. The reactions off triple bottoms are generally much less substantial than those off double bottoms. After a bit more work around the middle band I expect price to head back to the lower band one last time.
I have drawn a Fibonacci Fan from the August 2015 high to first lower low. Price has now punched above the 88.6% angle of this bearish fan which is bullish. I suspect price will shortly go back down to test the support of this angle and that is where I expect the fourth low of the quadruple bottom to form.
The expected big bear rally will be confirmed once price cracks above the previous swing high set in August 2015 and is denoted by the horizontal line. This level stands at $1038.
We will look at the bigger picture using the weekly and monthly charts in the next newsletter.