Coils have a sort of spring energy, and tend to resolve with a large move in either direction, with the favoured direction being that of the underlying trend, in this case up.

The resulting move was a Wide Range 7 bar (W7) (oval #2 on the chart below), in fact wider than any bar back to the original W7 bar rally to $1.18 on 9/24/12 (oval #2). This shows the strength of the break-out, but also can signify a pull-back condition once the profit takers kick in as they did after the prior three rallies.

Today saw a smaller move up, on above average volume but less than the W7 bar. CTIX tested, and closed just below resistance at $1.50, which is also the all-time high for CTIX. The lower volume suggests the buyers may be running out of steam at this logical price line.

$1.50 is also one of those round numbers the markets tend to like (markets are made up of people) So on balance, I would consider $1.50 a logical point for either a bit of sideways action, or more probably a moderate retracement. One would expect a battle zone at that resistance line.

In general, a W7 bar, should see a retracement to about half of its size, although back on 9/24/12 it retraced 100%. These assuming the W7 is a continuation bar, not a trend reversal.

Notice we have a new, 6 day red diagonal trend line, with a strong rally this could contain any pullback, and for tomorrow will approximately intersect about 75% and the Thursday about 50% of the W7 bar.

This would be a pullback target of $1.32 over 2 days, 50% of the W7 bar and where the red trend line is tomorrow, but if the new red trend-line remains intact, this number will rise every day it isn’t touched.

Alternatively, support at $1.18 could be tested, but I see that as less likely unless the pullback period is for several days, or weeks, as it was after the first W7 move to $1.18 on 9/24/12 Yes prior support is often tested and definably possible, but CTIX is behaving strongly.

Likewise a pullback to the longer term green diagonal trend-line is a possibility, but that would require a test first of two support lines, $1.18 and $1.11, so it would take longer and the green diagonal trend-line may well be past its sell-by date.

Keep in mind these are on-balance calls, not absolutes. Just my opinions based upon the charts and my work, not certainty! The buyers and sellers will determine what happens next, and orderly price action only occurs in between news, rumours and other publicity which proves the larger catalyst.