The second Rising Wedge target of 26.13 got MADE in yesterday's trading (that's the pattern in blue). Just a suggestion, but if position players who shorted the break of the H&S Top (the one in red), or who shorted the Rising Wedge (in blue) "take at least some profits when targets get MADE," this is the second opportunity for them to bank some, and to lock in a winning trade, with a Buy To Cover stop above KEY RESISTANCE at 29.29. It's perfectly fine, of course, to short yesterday's break of the H&S Top (the one in black), as a "continuation play," but those who got in early now have almost no risk on the trade if they "banked some" at the two Rising Wedge targets.
I make that suggestion because, so often, we misfocus by asking the wrong questions, like "What is this stock going to do?" "Will the remaining targets get MADE?" "What is going to happen next?" Answer to all three of those questions: "We don't know, because we can't predict the future (unless we're psychics...LOL)." Therefore, I suggest focusing on "How are we going to play it," if at all.
The H&S Top (pattern in red) target of 25.27 still is IN PLAY, and as long as Morgan trades below the neckline of the larger H&S Top (pattern in black), 20.14 is IN PLAY.
Math for the larger H&S Top (in black) target:
The neckline was at 25.56 when the 31.98 high got put in (draw a line from the high straight down to the neckline), so...
31.98 - 25.56 = 6.42 points of downside from where the neckline was when the pattern broke down, which was 26.56 yesterday.
26.56 - 6.42 = Target: 20.14 IN PLAY.
The slope of the neckline rises at the rate of 0.0474 per day, so add that amount each session to see if Morgan fails near there on a retest. If it does, then makes a new low for the move, that's further confirmation of the H&S breakdown. If Morgan trades back above the neckline, the breakdown is in question. If Morgan CLOSES back above the neckline, the breakdown is in more serious question.
The neckline comes in today, July 8, at 26.603.
Speaking of July 8, this is kinda fun:
AT 5 MINUTES AND 6 SECONDS AFTER 4 P.M., THIS AFTERNOON, THE TIME AND DATE WILL BE: 04:05:06 07-08-09
THIS WILL NOT HAPPEN AGAIN UNTIL THE YEAR 3009!
2 comments:
Is there any time horizon that one could expect for a backtest of the neckline?
Cute little time and date comment. I would think it would be the type of information a precocious teenager might notice and pass on to an adult.
Good Morning, Mark,
No, nothing as far as time horizon, and breakdowns don't always get retested.
Yeah, I liked that deal with the date, too. It had to be a precocious teenager who discovered it ;)
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