Today, we will look at a possible setup we may take on PLTR if everything goes as expected.
a) At the moment, the price is making contact with a relevant resistance level. That's why we want to see a breakout attempt before taking action
b) Whats are we waiting for? We want to see a correction with similar proportions to the oval you can see on the chart. Why? Because it is a similar size to a pattern that has already happened in the past.
c) If that happens, the trading scenario is simple to understand. We will execute setups above the oval. Stop loss below the oval. Break-Even level on the line that says "protect your setup." Final target at the end of the 2nd green arrow (42.50)
d) What about risk? We will risk 1% of our trading capital in a scenario like this. That means that if the setup is executed and then the price goes straight to the stop loss, we will close our position with a -100USD (assuming we have a 10.000USD account)
e) The expected time for a movement like this in case the corrective pattern happens as expected is between 20 to 30 days