About meMistakes, Lessons, Looses, Gains, Pleasure, Pain. Can't have one without the other this market is a Lover and a Murderer it can make a Poor man Rich and a Rich man Poor. Respect IT! Learn It! Profit! Learn from every loss so when I lose its still a gain.
I'm not here to call tops this is just an observation of a potential fractal play. Here i'm highlighting some key similarities between the move we have experienced the last few weeks and the one we experienced in May. Notice there are many similarities in how these setups began so it is not out of reason to suspect there could be similarities in the way they end.
1.) The upward move that started on 4/18 traveled 10.11% before sellers stepped in and began the distribution process notice that this current move has ran 10.14 % already.
2.) When the market made new 52wk highs back on 5/3 it traveled 5.81% until it topped out. I have referenced this same percentage breakout run to the one we are experiencing now which does allow for some additional upside from here but i'm still cautious .
3.) A ton of people are looking for upside continuation for the Santa rally so this may make my observation invalid however after large moves to the upside investors may be looking realize some gains and start taking profit for the year so monitoring price action at these levels may help spot a trend shift.
Trade Wise - Stealth
Facebook has had a tremendous run over the past few weeks. On this chart I have highlighted a pattern that has been propelling this stock forward whether or not this pattern continues I can not say. However, what I can do is point out some key patterns. First off Facebook likes to pullback an average of 6.58% before buyers step in. Second sentiment can be gauged using the 15 EMA. Third after price retraces from those pullbacks and break out to new high the stock usually rallies at least 2$ before a significant pullback.
(Summary).... On this chart I have highlighted the key areas of interest that I find important in navigating this stocks price action. I have listed the major support and resistance area.
(Pattern Type) Inverse Head and Shoulders / Break Down
(Target Price) 122 , 130
(Bull Perspective) In order for this trade to initiate price needs to break and hold 114 notice in the past when price tried to break this level it could not hold and resulted in a head fake so volume on a break and the ability to hold the break to the upside is crucial.
(Bear Perspective) If price fails to break this resistance then a short trade may be in the works on signs of break down the first target for the short trade would be the bottom of the green channel then support floor 1.
(Overall Market Influence) If the market receives a pull back in the coming days it may inhibit the bullish trade from taking place.
This trade I'm looking for a possible reversion to mean on oversold conditions. The first target for this trade is the unfilled gap. The second target would be the median line of this projected channel and the third target for this swing trade will eventually be the top of this channel I have placed flags the mark those last two target and a yellow circle to market the first target. I like the risk reward at these levels and I highlighted an important support range which I will be using as the stop for this trade.
(Background) Since Apple has feel from grace many people have lost a great deal of money trying to catch this massive falling knife it has literally destroyed thousands of Irresponsible hedge funds and and individual investors and traders a like.
(Summary) This chart is highlighting the current distribution channel that APPL has carved out the last few months and pointing out some key pivot areas and price behaviors to watch to better navigate the trading flow of AAPL's price movement .
1.) Distribution Channel - This is most important aspect of this chart until price is able to break and hold above this channel price is technically still in a downtrend. This channel has stopped every recent rally in its tracks a break and hold above this channel especially on high volume may be the first clue that distribution may be ending in AAPL .
2.) 100 EMA - This is another important element of this chart. AAPL has not been able trade above this moving average all year if price is able to reclaim the 100 EMA this may further confirm that distribution has ended in AAPL.
3.) Targets on Bullish Break Out - I have highlighted a few possible targets / resistance zones for the scenario of a bullish breakout highlighted with the (yellow) and (orange) dotted lines. I have also listed several pivot highs that may also act as resistance zones.
4.) 200 MA - The 200 MA is naturally huge psychological area as well I have highlighted this on the chart as well as it may also act as type of price magnet if price is able to successfully break this downtrend. ( A break and hold above the 200 MA would be further confirmation distribution has ended in AAPL ).
5.) Head Fake - Every once in awhile price may trade above a major resistance area only to sell off this is where the importance of volume usually comes in play if there is a large volume spike it usually adds to the validity of the move.
6.) Pullback - Most of this trade summary has been oriented around a bullish argument but as a trader I must view a trade setup from multiple angles if AAPL is unable to breakout of this distribution channel it is technically still in a downtrend and probability favors a short trade. This is why gauging price action the next few days will be important.
(Summary) On this chart I have highlighted a possible historical price pattern swing trade. I'm referencing price action from last summer which in some ways has exhibited similar price behavior to this years price action. I'm looking for price to put in a solid footing at 169 range notice last summer before price was able to break to the upside and complete it's measured move it consolidated around the previous highs this type of price action may also occur before this trade fully initiates.
(WARNING) The RSI is near overbought territory this may mean that ranging as I spoke about above or a pullback may have to occur before this trade can initiate.
(Pullback) If a pullback does occur i'm looking for support near the 166-167 range to say bullish for this swing trade. I will keep those interested updated through the comment section.
(Side Note) Like last time patience will be key and I will be actively trading around this position. Remember price action is the only thing that should be traded and not opinions.