Chart of the day: Steel spectacular!
We had warned that Shanghai steel rebar futures had completed an inverted head and shoulders with a weekly close above the neckline, which would likely make moving averages cross to bullish. So they did and boy, did it steal a march against other metals. Three powerful bullish weekly candles make up what is known as “three white soldiers”. So strong have these been that prices have exploded through the (thinner) weekly Ichimoku cloud, inching above the top of the bearish trend channel since mid-2011. Now perhaps it is time for a little consolidation but this upper line, plus the top of the Ichimoku cloud, should provide support for bullish follow-through that the soldiers command.
Nicole Elliott is a technical analyst