TheMarketSource

$CHK Potential Breakout

Long
BATS:CHK   Chesapeake Energy Corporation
198 views
0
CHK is shaping up for a move out of an ascending right triangle. Currently stalling at the 200 day MA which is coinciding with resistance. It's in the sweet spot for a break above the $21 area as it's coiled about 75% to the apex of the triangle. Indicators are strong, and the weekly chart is also showing a decision point where major support and resistance intersect. Looking for a confirmed break above $21 with stop at $20 (a few ticks below the 200 day MA - algo's tend to overrun or slightly overshoot support and resistance levels in an attempt to shake out weak longs or shorts. Putting stops a bit out of these ranges helps to avoid this sort of pitfall).

Comments

Update:

RSI weakened and broke below 50. MACD turn down and appears to be headed lower. Testing bottom of triangle support on a gap lower. Momentum is failing and likely not going to pan out to potential. Even if price breaks out, it will likely be a false move. Potential support at 18.50 and beyond that 16.60.

Weekly chart also confirming waning strength. Since we never received a buy signal, nothing is lost. Other trades out there in much better shape.
Reply
Followed.
Reply