I've been following this stock way too much. Great fundamentals, growth, leadership, they are buying back stock... but somehow they've broken the $25 support (maybe they ran out of money to buy back?). At least it looks like that to me. No matter how I slice it I'm having trouble making a bullish case in the short term. However I'm still targeting $28 in the near term. This chart shows how I think it could happen.
If you look back at their earnings in February, the short-term traders took the stock down nearly 5% the day after earnings. Combined with IV crush this would have been the perfect time to buy calls. Then reality set in that this company is making a lot of money, they announced buybacks, and the stock took off. I'm hoping the same thing happens again this week.
Assuming it drops to $23, the .786 retrace is right at $28.
Trade active
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Went long at 23.50, didn't commit enough though. Doji candle and trading above 25 today, closing at 25.03. So that's a good sign. Looking to add to the position soon.
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I expected resistance @ 25. The declining volume could be bullish, perhaps the weak hands are all gone?
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Well the resistance at 25 turned out to be quite strong. New support could be 22 or lower. I'm still very bullish on this company.
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Somehow I managed to miss the strong support at 22 here and missed the whole thing. I am like, how do you say, really bad at this.
Next resistance was $22 and otherwise you stand correct.
ChartMeNot
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@Pokethebear, blast from the past. Thanks for commenting.
After 2 years I am still not profitable. Not because of poor analysis but: strategy, emotions, sticking to the plan. Obviously.
There are traders who are successful on simple support and resistance (like shown here). Buy at 23 and sell at 25. That's 10%. With proper risk management you could be profitable with trades like that, even if you're right only 50% of the time.
Pokethebear
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@ChartMeNot i'll send you my chart and test it for short or long. agree would take even 2% mo. = 24% annually. 10% = 120%