$OJ Orange Juice, the Silent Winner. The big trends are normally the ones that take place quietly and after the big move, people start to notice them. Let’s examine Orange Juice and why I am talking about it.
Below is the monthly chart for Orange Juice provided by eSignal. Since April 2012, Orange Juice has been in a long term consolidation pattern between 105.46 and 162.19. Sept 2015, we reached the support and price bounced off this value with a high probability of now reaching the resistance over a long term period.
November 2015, we got close to this value but we couldn’t reach it. After this date, price came back to the half way mark and consolidated around this area. A minor monthly support around 132 developed. With this minor support holding, the probabilities increased for price to go back to the resistance of 162.19 instead of reaching the support at 105.46.
If the monthly minor support holds, the long term view was bullish to get to the resistance. If the monthly minor support fails then the long term view was bearish to get to the support. Let’s now examine the weekly time frame for bullish opportunities.
Below is the weekly time frame. Price is swing around the minor Monthly support. At one point, the support held and price took off to the major resistance. I placed a vertical line at the point price moved. At that vertical line, notice the weekly SKB (black line) match the monthly red line support (132.07). The SKB was moving until that point date/time. When the SKB value matched the monthly support, price took off. A multiple time frame support got created at this point.
Below is the daily time frame. Noticed, price broke out of the cloud twice. The first time, it didn’t go anywhere but the second time it took off. Why? The first time, the daily support at 132.07 didn’t match the weekly support at all. Therefore, there was no multiple time support created. The second time occurred after the vertical line we draw on the weekly chart. After this point, the daily/Weekly/Monthly had the same support at 132.07. This was the multiple time support to allow a trend to occur with high probability.
Below is the 240m time frame. A trader could have taken a trade off this time frame safely with a very good reward/risk.
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