We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. Entry: $79 (if found resistance, after falling below $70)ĭisclaimer: The author has no positions in any securities mentioned in this article.Trade Sample 3 - Conservative Short Position Trade Sample 1 - Aggressive Short Position If you don't have one, here are generic examples for educational purposes: Moderate traders would wait for the throwback for a better entry if not for added confirmation.Īggressive traders can short according to their personal strategy. Trading StrategiesĬonservative traders should wait for the price to break the $70 round number and rally to confirm the resistance before risking a short position. The length of $17.08 between the May 12 low of the head and the July 15 shoulder low of $96.11 is then assumed to repeat from $79.03 of the pattern's head to the downside. A technician measures the distance between the head and the right shoulder to reach a downward target. This development increases the risk of attracting short sellers, increasing supply.
Disappointed longs closed position, reducing demand, allowing supply to drive prices lower. Morgan's pessimistic view regarding the firm's short-term performance due to increased competition from Microsoft (NASDAQ: MSFT) and others. 6, the stock attempted the $79 level, where the head's low was, and failed, falling back to its recent lows.Īn H&S failure results from misplaced optimism, jiving with J.P. 16, the stock took another turn lower, falling below the would-be reversal pattern's head, and registering a new low. However, after lowering its full-year profit and sales forecast, the company's stock plummeted 16.5%, blowing out the reversal pattern. Zoom stock has been developing an H&S bottom since Mar.
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