« Chart in Focus: Rising Wedge Reversal on NDX (2) »

Nasdaq-100 Index daily chart showing potential rising wedge formationThe daily chart of NDX - depicting a potential rising (bearish) wedge reversal - was initiated as the "Chart in Focus," on Wednesday. Between that posting and the close on Friday, there have been a couple of developments that allow this chart to remain in focus.

The index broke out of the rising wedge (on a closing basis) on Wednesday and then lost further ground on Thursday. Prices looked well on their way towards fulfilling the objectives derived from the wedge. A 1.25% rise on Friday has, however, put the formation in a bit of doubt.

There has not been an "unconfirmation" of the formation as yet, but virtually any gains from current levels will nullify the formation. Moreover, it needs to be noted that there wasn't a surge in volume upon the breakout and, as such, if this is to prove to have been a successful wedge formation traders will not only need to see an immediate drop in prices but also an accompanying rise in trading activity.