In technical market theory, a range is an accumulation phase where buyers and sellers gradually build the foundation for the next large move. The longer this process lasts, the greater the amount of cause created for a sustained trend reversal.
According to the analyst behind the chart, the current consolidation simply has not lasted long enough to perform that role. Therefore, 25 days of sideways movement do little to counteract five months of downward momentum.
Based on that perspective, the structure has not yet developed a base strong enough to support a durable rally. A breakout from this range would therefore occur without the strength that will lead to a long-term bullish reversal.
Bulls Might Actually Want More Time
