It presents two potential trades on IBB:
1. (short term) setup - 270$ is the key zone as it presents a weekly .
2. continuation (based on longer term analysis) - Continuation of the the waterfall that started on May 2015.
Waiting to here your thoughts.
270$ is nearest support.
I'm interested... why 305$ as stop loss? Buffer above 300$
There's a minor structure near 308$ but I guess that's the same.
I agree with you analysis. One clarification - For it to reach 220$ it must break below the Flag pattern... that's the critical confirmation signal
Thank you for your interest.
$305 was the support area in the late Sept flag. $300 is "too round", so allow for some small slippage on the upper pins as well. I need a close above/below my SL to trigger, not intraday.
I prefer to draw my lines off the candle bodies. So I see the lower flag boundary at closer to $255.
So $255 - ($300 - $255) = $210 as a guide, but there appears to be some solid support at $215, so being cautious, I would be happy to take money off the table at $220.
So, if I had 5 contracts, I would sell 3 and let the remaining 2 run, and use my ADX indicator/candles to give me a final Sell alert.
The flag break down trigger, will be a close under the lower boundary. A decisive break and rebound (retest) could be a potential second sell area. But more importantly, I would be running a medium term SMA to give me trend direction, and your SMA 50 tells me it is Down. So don't fight that.
I use patterns and price volume relationships (classic theory) as my main guide. Indicators are just other names for price - that is where they are sourced. Candles and ADX provide my fine tuning and math provides me my analysis.
Just my 2c worth ...