Moody's is downgrading the entire energy sector at the bottom. [GLNCY]

If you do a quick Google search for "Moody's downgrades" you will see that the credit rating company has done a rash of downgrades pretty much across the board to anything with "resources" in the title.  Lots of those ratings moved the debt into junk territory.  Well I don't know if the late September bottom was the bottom but it was likely a significant bottom for Glencore.

The backlink model is below.



While the chart did go 1 penny lower than the stop indicated above, I can see a count by which that is still a valid C of 2 (or B).  My red path remains primary and we are now at an interesting test point.  We've rallied to the level of the prior 4th and also to the short term resistance line.  This will either be broken out of during the next trading session or it will be respected.  If broken out of, I expect to see $4+ soon.



Now for those who think that GLNCY is down here for some kind of real fundamental reason, please note the recent credit downgrade by Moody's took GLNCY to Baa3 with a stable outlook. 


As you can see here, that is still considered investment grade!  So this is not down here based on imminent risk of BK, etc.  It's just that all energy is out of style because fools think that an energy glut can last forever.  It can't!! Even in a global recession we humans consume a ridiculous amount of energy and other natural resources.

These share price fluctuations are simply the volatility that one has to expect when operating under a currency supply that has no intrinsic value.  GLNCY will cut its leverage and then reinstate the divvy in a year or two but by then the shares could be $8 again.

With all that said, the blue path is still viable and so of course stops should be used in all trades.