We often talk about marginal new highs or false breakouts as a technical sign for a top in a market, be it a stock, commodity or index. Yesterday a few caught our eye specifically in the resources sector which creates further evidence that we should be cautious in this part of the market for now. The chart below of Lynas Rare Earths (LYC) features a red circle highlighting the marginal new high, for the technicians, a marginal new low of the range becomes the more likely scenario – that targets a move under $8.60 for LYC.
MM is bearish LYC in the short term
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