Cyclicals on the Cusp of Change
The consumer-cyclical sector is poised for a significant change in its price structure in the months ahead. The indices for the group have formed large consolidation patterns, which are typically precursor signals either to a resumption of the primary trend or a potential reversal. These indices are still holding the primary uptrend channels that were started in 2009, and the odds favor an upside resolution to these consolidation patterns and another leg higher within the cyclical trend channels in the coming months.
The Morgan Stanley cyclical index has formed a large symmetrical triangle within its weekly price structure. The group has been in a corrective condition since the beginning of 2011 as investors have pondered the state of the economy and the effect of the European debt crisis....300 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.
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