TZA Chart Falling Wedge Positive Divergence -- Launch Time
TZA is the inverse triple magnitude small cap ETF; always a dangerous trade and not for the faint of heart. The blue falling wedge is a thing of beauty, rarely do they form so perfectly. The stochastics are oversold. The green lines show the positive divergence that bounced TZA a few days ago. The purple lines show the current positive divergence in place ready to launch price again along with the falling wedge and oversold stochastics. The pink lines also display the long and strong profile to the chart, bullish. The weekly chart is positively diverged as well providing further street cred for a move up in TZA, which means a move down in the small caps, and broad markets.
Note last Thursday when TZA price started to move south again, those traders that had been holding on panicked and sold as shown by the large red volume candle. This hints of a capitulation type move which also furthers the liklihood that TZA has washed out for now and will head higher from here. Note that the falling wedge allows a bit more downside before the launch, but, considering that the green lines already bounced price and this is more of a second thrust higher that will occur, the chart is prime to launch at any time.
The gap at 19.8-ish is an intial target. Price moving above the 20-day MA would be a very bullish indication, as well as the money flow, RSI and stochastics moving up above the 50% levels.
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