From All Star Charts:
There are certain patterns in markets that get me pumped up. One of them is the long consolidation that fails to break out in either direction for a sustained period of time.
The way I look at it, when something trades in a prolonged, tight range, it’s building momentum for a potentially ultra-powerful move.
The breakout in the Dow Jones Transportation Average these past few months is the perfect example. I wrote about the setup in late November for MarketWatch and Transports are up a hefty 18% very quickly. The size of the move is great and everything, but it’s the relentless manner in which it rallied that really proves the point.
On a shorter time frame, Indonesia looks like it might be able to do something similar. I can’t help but notice so many of the similarities between the two setups. The first chart shows…