XJO Momentum Carries Into Friday's Close

The XJO enjoyed its eighth daily rise on the trot as it ended the week sitting well above long term resistance originating from mid-2012. Volumes were on the higher side of the spectrum as MACD continued to diverge bullishly. It seems that all systems are go for a run into the 4,850-4,900 region in the near term, with the technical trends showing no signs of breaking down.

With the long daily winning streak likely to come to an end soon, we see possible resistance at the upper bollinger band which the XJO is currently close to touching. We expect 4,800 to hold upon such a pullback if it eventuates. The next major obstacle would appear to be the 100% retracement of April 2011 highs of 4,969.

The weekly chart shows a similar picture, with resistance trending from June 2012 seemingly broken with this week's rise by the XJO. Again, the upper bollinger band may prove to be resistance in the near term. The next key Fibonnaci retracement of all-time highs is the 50% level at 4,962, and there appears to be ample legroom for the XJO to continue its pursuit of this.