Good Morning Folks. Im going to start posting the charts that I'm trading, maybe someone could benefit from the hardcore technical analysis. The stock market is govern by technical analysis, although other markets react more strongly to tech analysis, especially the foreign exchange. I find that the stock market gives more meaning and more legitimacy to the technical analysis side of trading! So lets jump in to the trade of the day! Remember folks, the less you trade the more profits you keep. I find the the first morning trade is always the best! So I will stick with and accumulate!
So we all know twitter had good earnings and price shot up at the time. This is the reason I'm sticking with twitter, for now at least, and because twitter is talking, about where its going that is! I took a look at the daily chart, and seen a perfect railway tracks. Railway tracks means a turn around of prices. Price goes down, then realizes it made a mistake, which actually means buyers are taking control, and price started heading up forming the second rail! This made me believe to look for technical's heading higher!
Did not find anything technical on the 4 hour chart! Now the hourly chart started talking to me and showing me something. Looks like we have an inverted head and shoulders pattern forming. Remembering that I seen railway tracks on the daily chart, made me believe that this inverted H&S are valid! We have 2 signals now, the railway tracks and the inverted H&S! This is not enough to enter a trade, so I continued looking. Then I drew a trend line and I saw that price action tried to break that trend line twice already, and that if price starts to break that trend line the 3rd time, well 3rd times a chart as they say! Then i drew a neckline, and when price breaks the neck line, that's an opportunity for a trade!
So we now have 4 supporting signals for prices heading higher, and were only on the hourly chart. Lets see what we can come up with from the lower time charts! The 30 minute and the 15 minute charts are showing same patterns and formations, which adds power to the buy position! Because 2 time frames are showing the same thing as other time frames, which means they are agreeing with each other! which in turn means price will head in only one direction, and that's not down! We have a double bottom forming on the 15 minute chart, which means price found support with the previous level, and will now look to head higher. We are waiting for prices to break out of the trend line, and breaking the neckline almost at the same time. So we now have 5 signals with the double bottom, and I'm not even counting the same pattern on different time frames, which I should. In reality, we have like 8 signals supporting higher prices!
The 5 minute and the 1 minute are almost identical, but on the 1 minute chart we can see more! We have the formation of another inverted H&S pattern, but I did not buy on that. I waited for price to break the 15 minute neckline, and as soon as price action broke out of that neckline, it started to head higher and since I knew what was going to happen, I executed a buy trade @ $30.78 with 3000 shares. I waited for price action to head to the next available resistance area, which was an R1 pivot level. Profit target reached and i got out of the trade @ $31.02 for $720 profit!
Like I always say, wait for the security in question to call you in, it will if its going somewhere!
