SIGNIFICANT BREAK OUT PART 2 1/24/14

Break outs come in a variety of duration and extension.  In a normal trading range day we can see the smaller versions in the BO-5 to 10 range.  Moderate BO's that run 15 to 25 points, and major buying/selling run that exceeds BO-30/35.

The market began the week stalling in a narrow trading range.  With each day's inaction the market builds pressure to break away from the TR.  Add some news (a dose of fear or greed) and the BO trend can gain momentum.

For two days the BO ran bearish, the trend.  Pull back attempts are contra trend and have restrictions:  hit a target and we may have a reversal; miss the target or stall at a prior BO Level resistance and the prior trend continues.  Much like the micro range Control Bars,  BO Levels will be considered support/resistance where we watch for a failure or break.

The pre open for the US Market had a micro bull trend developing.  Target 1 was set at   18.5-19 with a secondary BO target 2 set at 26.5-27.  Price was challenging the 20 EMA and we were approaching a BO Level at 1817.

Price stalls and we drop back to the BO-1812 and three selling legs to the next level at BO-1807.  (levels are measured in 5 points)

On the 5m chart, price simple could not break the 20EMA and the down trend continued.