CNEH Update

I last posted about CNEH here. I think it is near another short term peak, and could correct to as low as $3.80.

On the 1-hr chart above, notice the clear 5-wave rally from the $2.75 low. I think this is Wave3 in the rally from the $1.61 low formed back in March, and now we should see Wave4 down.

Several indicators support this notion. First, there is MACD and RSI divergence, which is bearish. Second, the all-time high at $4.55 looms near and should act as resistance. Third, there are few catalysts remaining in the near-term that will continue to drive up price. Also, the fact that the price reacted rather midly to blow-out earnings on May 15th indicates that, on the short term, investors are pricing in the news beforehand.

$3.80 is the Wave-iv low and near the 38.2% fibo of the rally from $2.75-->$4.40. I think this should act as decent support.

Longer term, we may see a very significant rally. Since Wave3 and Wave1 are fairly equal in length, we could see an extended 5th wave rally. This could bring us into the $8 range. Time will tell.

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