Momentum and Extension

Bullish momentum dominates, but the advance is getting extended and could benefit from a short correction. The high touched a top rising channel line — a 200% extension of the original channel from August’s low. The original top line was touched with recent lows after placement at October’s swing high (B) showing recognition of the pattern. This extension suggests caution, as overbought conditions may invite profit-taking.

Upside Targets

A strong close and Tuesday breakout could target $4.41-$4.45, combining the 78.6% Fibonacci retracement and 161.8% projection for a larger ABCD pattern than that currently on the chart. Today’s advance also triggered a monthly breakout above October’s $4.16 high, with June’s high also a monthly peak. October’s $4.12 close was the second-highest monthly since January 2023, reinforcing bullish momentum and structural strength.

Long-Term Implications

Sustaining above the June high opens a challenge to March’s $4.90 trend high. A daily close above the June high provides technical evidence of underlying strength, supporting recovery after any correction. Resistance may persist near the extended top channel line, but price can rise while staying below it given the angle — allowing room for gradual upside.

Downside Support

Short-term support sits at last week’s $4.16 high and today’s $4.09 low. Further down, the 38.2% retracement at $3.88 aligns with a top rising channel line. The 50% retracement at $3.75 matches October 29’s low, offering a deeper floor if tested.

Outlook

The close above $4.16 is key — above it targets $4.41-$4.45, below risks $4.09. The breakout and monthly signal favor bulls if $3.88 holds. Watch channel extension — $4.90 follows on strength, but a pullback may test support first. Momentum remains bullish unless $4.09 fails.

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