Price action & Psychology - Breakout and first pullback
Hello !
I am so excited for the week ahead.
Key points :
Context
The interesting thing on this chart, is that before the consolidation, a double bottom formed. Anyway, the momentum was not important enough to break through the resistance. After consolidating and pulling back halfway (from the second bottom), enough momentum was gathered to breakout, which explains the spike in volume.
This also tells us, that a psychological shift happened : there's been more greed and a stronger conviction (wide range candle and spike in volume).
The plan
Using the top-down method (i.e three screen method), the weekly chart gives us an insight of the bigger picture. The first resistance on the weekly chart is around 14.00. The "minor" resistance at 8.50 is more of a level to watch.
The more candle (i.e confluence) there is around an area, the stronger it is. Anyway, I plan the trade up to that level and I decide what to do once it reaches it.
Thanks for reading and if you have suggestions or wanna discuss the idea, just leave a comment, I'll be happy to answer.
***Disclaimer : This is not an advice to buy the stock. Please, be aware that trading is a matter of probabilities, it takes only ONE trader to deny your trade.***
I am so excited for the week ahead.
Key points :
- Breakout after consolidation + spike in volume
- Volume on uptrends is higher than on downtrends
- First pullback after breakout (61.8% Fibonacci retracement)
- Holding support despite the fact that the overall market was down on friday
Context
The interesting thing on this chart, is that before the consolidation, a double bottom formed. Anyway, the momentum was not important enough to break through the resistance. After consolidating and pulling back halfway (from the second bottom), enough momentum was gathered to breakout, which explains the spike in volume.
This also tells us, that a psychological shift happened : there's been more greed and a stronger conviction (wide range candle and spike in volume).
The plan
Using the top-down method (i.e three screen method), the weekly chart gives us an insight of the bigger picture. The first resistance on the weekly chart is around 14.00. The "minor" resistance at 8.50 is more of a level to watch.
The more candle (i.e confluence) there is around an area, the stronger it is. Anyway, I plan the trade up to that level and I decide what to do once it reaches it.
Thanks for reading and if you have suggestions or wanna discuss the idea, just leave a comment, I'll be happy to answer.
***Disclaimer : This is not an advice to buy the stock. Please, be aware that trading is a matter of probabilities, it takes only ONE trader to deny your trade.***
