9.4.17 | BAC | Double Bottom Breakout to Rising Wedge
BAC
(Code-Name_Virtue) Minor Trend Analysis
Historically price has traded into a three point reversal shown on the chart as a connecting line plotting 3 points (ABC) along the peaks and valleys. Within this three point reversal a Double Bottom chart pattern has formed and broke out. Towards the end of last week price traded outside the neckline of this chart pattern and also completed the pull back to it forming a Rising Wedge chart pattern on the breakout. Currently there is about $.35 of volatility left in the wedge for price to trade to before it is forced out of the chart pattern by default. Drawn on the chart are support and resistance lines, a Fibonacci Retracement, and red lines indicating strong values of supply. This establishes the grid for price action and the focus I would like to call attention to within this grid is the red supply lines which price is now starting to trade into. These supply values are strong, and I do not think price will have momentum to trade past them; the three point reversal has not shown a sign of a reversal supporting the speculation that price will not trade past the allotted $.35 of volatility before it reverses bearish. The indicators displayed are: the RSI, MACD, and Stochastics. RSI may have formed a Triangle in an overall bearish downtrend suggesting a squeeze to the downside, the MACD is at resistance of a downtrend and also at the zero line with its histogram in consolidation, and Stochastics has just entered overbought. The overall consensus is that we may see price trend bullish for 1 more day, or even gap up to sell off all day before it reverses bearish.
(Keymaker) Option Strategy
Entry: on the high of the 30 minute or 1 hour chart.
Target: exit as Stochastics enters oversold or when you're comfortable.
Stop: $.15 above your entry.
Please scroll down for Intraday charts.
(Code-Name_Virtue) Minor Trend Analysis
Historically price has traded into a three point reversal shown on the chart as a connecting line plotting 3 points (ABC) along the peaks and valleys. Within this three point reversal a Double Bottom chart pattern has formed and broke out. Towards the end of last week price traded outside the neckline of this chart pattern and also completed the pull back to it forming a Rising Wedge chart pattern on the breakout. Currently there is about $.35 of volatility left in the wedge for price to trade to before it is forced out of the chart pattern by default. Drawn on the chart are support and resistance lines, a Fibonacci Retracement, and red lines indicating strong values of supply. This establishes the grid for price action and the focus I would like to call attention to within this grid is the red supply lines which price is now starting to trade into. These supply values are strong, and I do not think price will have momentum to trade past them; the three point reversal has not shown a sign of a reversal supporting the speculation that price will not trade past the allotted $.35 of volatility before it reverses bearish. The indicators displayed are: the RSI, MACD, and Stochastics. RSI may have formed a Triangle in an overall bearish downtrend suggesting a squeeze to the downside, the MACD is at resistance of a downtrend and also at the zero line with its histogram in consolidation, and Stochastics has just entered overbought. The overall consensus is that we may see price trend bullish for 1 more day, or even gap up to sell off all day before it reverses bearish.
(Keymaker) Option Strategy
Entry: on the high of the 30 minute or 1 hour chart.
Target: exit as Stochastics enters oversold or when you're comfortable.
Stop: $.15 above your entry.
Please scroll down for Intraday charts.
Comment:
Comment:
My speculation is that price will not make it past the red dashed line at $24.30. This is based on the rate of decline in the momentum of the uptrend, and nothing else. Although it is in correlation with the supply values.
Comment:
Also Note the RSI. My speculation applying what I have just learned from @gumbtg is: When the RSI breaks the support of the trendline, which I have forming an ascending Triangle, it signals a Sell off.