CNEH Technicals (Update)

I last posted about CNEH here. It has since rallied nicely, and appears to have broken out of the ending diagonal. I think it will retrace for another day or so, and should be supported around the $2.10 range.

This recent run-up is analagous to the rally in late August, 2007. Back then, price increased sharply but then dropped from $1.94 to $1.38 (a 28.8% drop) in 3 days, on decreased volume. Similarly, the past week saw price increase from $1.61 to $2.60 on increasing volume. We have now seen two days of correction on lower volume, so I believe there could be one more corrective day. My downside target is around $2.10, which is the 50% fibo level, as well as where WaveC would equal WaveA on the intraday chart.

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