Even if the market isn't tracing out a triangle, traders are looking at the trading range

Just as I was preparing charts of the Nasdaq 100 ($NDX) to show a potential triangle within the range the markets have been confined within for days, the NDX "broke" the triangle concept. But I'll go ahead to show this and to show the range in this index. The chart at right shows how the NDX just poked above what would be the B wave of a triangle. I had not gotten around to marking the ABCD and potential E for a standard triangle on the bigger hourly chart (bottom chart below), but since it is above what would be "B" it doesn't really matter. Another pattern must be considered.

Still the basic concept is, there's a range and that's the main thing to focus on. The range is marked best on the hourly chart (underneath the daily chart, below).

Notice that other indices haven't traced out quite the same pattern (potential contracting triangle) because they've made lower lows recently. In those cases the pattern would have been a different form of triangle (or bulls would call a "bull flag").

However, what is critical is obvious - the indices must get above their early May highs in order to give traders a good reason to think that higher levels are around the corner.