The 50ema is crossing above the 200ema for the first time since early 2016. The shaded box region is where past 20 day highs are at, forming this potential support zone.
There are two potential buy options for this setup. As you can see, the R:R on the pullback presents a much better payout than the breakout option. You simply have to decide whether you can handle missing the trade entirely if you want the pullback and do not get it. Studying the previous breakdown after the crossover in 2016 is an excellent place to start. Another option is setting up a stop limit order to buy on the break and cancelling it if price instead pulls back to the pullback zone. I would not quite call this enough consolidation yet for a breakout, but another few weeks during the slow holiday season could be enough to be an excellent opportunity in early 2018.
Option 1 is price pulls back from here into this blue shaded region, and upon whatever confirmation your plan dictates you need, you have an excellent pullback long opportunity.
Option 2 is price consolidates up near these highs and you are forced to simply buy the breakout. Looking back to the previous 50/200 crossover, the breakdown was the only entry.
If that happens, the stop should start below the pivot low of the consolidation, currently under $19.01 plus whatever amount of cushion your plan requires you to give.
ST Targets would be near round numbers of $25-$27.50
MT Targets would be near weekly peaks of $31-$32
LT Targets would be upwards of $50 but this would require a month to yearly target.
As always, every trade carries risk, size appropriately. This type of analysis is predicting what could happen so that if it does there is no chance of being unprepared and missing the entry. This in no way guarantees success on this trade, but without planning your trades, your trading without a plan. And that is not something that can work long term.
If you do not have a plan or know how to size a swing trade properly, check out our website at customtradeplan.com where we show you how to plan trades before they setup so there is no uncertainty with what to do if it triggers. GLTA, Trade your own plan.
There are two potential buy options for this setup. As you can see, the R:R on the pullback presents a much better payout than the breakout option. You simply have to decide whether you can handle missing the trade entirely if you want the pullback and do not get it. Studying the previous breakdown after the crossover in 2016 is an excellent place to start. Another option is setting up a stop limit order to buy on the break and cancelling it if price instead pulls back to the pullback zone. I would not quite call this enough consolidation yet for a breakout, but another few weeks during the slow holiday season could be enough to be an excellent opportunity in early 2018.
Option 1 is price pulls back from here into this blue shaded region, and upon whatever confirmation your plan dictates you need, you have an excellent pullback long opportunity.
Option 2 is price consolidates up near these highs and you are forced to simply buy the breakout. Looking back to the previous 50/200 crossover, the breakdown was the only entry.
If that happens, the stop should start below the pivot low of the consolidation, currently under $19.01 plus whatever amount of cushion your plan requires you to give.
ST Targets would be near round numbers of $25-$27.50
MT Targets would be near weekly peaks of $31-$32
LT Targets would be upwards of $50 but this would require a month to yearly target.
As always, every trade carries risk, size appropriately. This type of analysis is predicting what could happen so that if it does there is no chance of being unprepared and missing the entry. This in no way guarantees success on this trade, but without planning your trades, your trading without a plan. And that is not something that can work long term.
If you do not have a plan or know how to size a swing trade properly, check out our website at customtradeplan.com where we show you how to plan trades before they setup so there is no uncertainty with what to do if it triggers. GLTA, Trade your own plan.