Wednesday Report: Large Patterns Lead To Large Moves

The month of August has been a very good month to have been invested in the PM complex after a six-month correction. So far the correction, or consolidation pattern, formed a bullish falling wedge which typically has a minimum price objective up to the first reversal point high. There are two possible outcomes for the current bullish falling wedge. The first scenario is that it could be a stand-alone consolidation pattern, meaning it’s forming as a halfway pattern to the upside with new all-time highs to come sooner rather than later.

Scenario #2, which is pretty common, is that the 2026 falling wedge will end up being part of a larger consolidation pattern. The outcome will be roughly the same as a stand-alone consolidation pattern but will be slightly larger, taking more time to complete. Either one is a bullish continuation pattern.

I built a new daily combo chart today to show how the PM stock indexes could be morphing into a larger consolidation pattern. But with limited price action so far, it’s just speculation on my part, but it could be a rough guide we can follow if scenario #2 plays out.