Base metal miner Labrador Iron Ore (LIF.TO) has returned to the Green Favored Zone of the SIA S&P/TSX Composite Index Report for the first time since August, continuing a climb back up the rankings that started in the red zone in November.
Today’s Labrador Iron Ore (LIF.TO) chart is a good example of why we look to both Point and Figure and Candlestick for insights into market trends and support/resistance levels. The late summer selloff in LIF.TO shares was, in fact, contained by a long-term uptrend support line which dates back to the March 2020 market bottom. Since then, accumulation has resumed and the shares have been steadily recovering lost ground in a Rising Channel of higher highs and higher lows.
Currently, the shares are approaching the $40.00 round number where a breakout would complete a saucer/rounded bottom pattern. Next potential resistance tests after that appears at the July peak near $46.00, then $47.50 based on a measured move and the $50.00 round number. Initial support appears at the 50-day average near $36.50, then $35.00.
Back in October, a selloff in Labrador Iron Ore (LIF.TO) ended with support emerging at a higher low near $32.50.
The shares then spent the rest of the year base building. This month, accumulation has resumed with the completion of a bullish Double Top calling off previous bearish patterns and signaling the start of a new upswing.
Initial upside resistance appears at a previous column high near $41.25, followed by the August peak near $46.45, and then $48.35 based on a horizontal count. A 3-box reversal suggests initial support may appear near $35.90.
With a bullish SMAX score of 9, LIF.TO is exhibiting strength against the asset classes.
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