RIG outlookSo looking at RIG on both the monthly and weekly chart, we seem to be due for a correction after a long run upward.
1. We are currently retesting a resistance at which we got rejected recently on the 24th of nov, but also in August and in June, I see this as a high probability area for a breather on the latest upward run.
2. We are approaching the W-cloud, which adds extra resistance.
3. We've recently broken and continued upward from a downward trendline (blue arrow), but without properly retesting it (not always necessary as we did see a brief retest on the daily).
If indeed we get rejected around the area of USD 2.50-2.70, then I will be looking at the following areas for a potential buying opportunity. (There is a possibility that we fill an old gap at 2.85 first as well)
Both the 0.382 fib, the 0.5 fib and the 0.618 fib are potential retrace areas, but I'm looking for confluence of support as well.
The 0.382 doesn't line up with any other areas of interest at the moment.
The 0.5 however lines up with a strong area of horizontal support, making it a more likely candidate. A retrace till here could also potentially see a retest of the previously mentioned trendline (blue arrow). See the orange scenario.
The 0.618 is below what seems as the strongest support. But in a scenario where we need to complete an inverted Head&Shoulders pattern, this area (or beyond) might also still come into play. See the red marks for the iH&S and the green scenario.
So to conclude, it's more likely that we do a retrace soon, then for the uptrend to simply continue. If looking for a selling area, look at USD 2.50-2.70 and perhaps even at the gap at USD 2.85.
If a retrace indeed happens we need to wait for price action to reach the areas mentioned above and wait for buy signals.
If I'm wrong and the trend continues upwards, wait for breaking of resistance and the retest of this resistance.
