We pointed out on July 16 that it was do or die time for NYA.  It had backtested a trend line connecting a string of lows that was 7 months long — as well as the SMA100.  We forecast a drop to 10387 by early August and 10,042 by mid-August.

We were right on the direction and the timing, but underestimated the extent of the initial drop.  Rather than find support at 10,042 — the potential neckline for a huge H&S Pattern — NYA plunged right through.

The drop to the white 1.272 at 9,513 surprised many investors, but was in keeping with our analog.

continued for members…Note that the drop merely tagged the bottom of a large rising channel that’s just as legit as the last.  And, since then, NYA has gapped back above the red channel bottom.

Though it still might need to consolidate a little, the analog suggests 9,513 was an important bottom for NYA.  If the analog holds, NYA should make new highs in the next month or two.The initial test should be 10,600ish for a backtest of the .236 white channel line and red H&S neckline.  The SMA50 should pass through later this week.