Resistance Becomes Support & Support Becomes Resistance
Trend lines are a great way to invest. That is only my opinion of coarse.
This chart is a 60 minute chart so remember the trend lines may not last as long as those on daily or weekly charts. But horizontal lines of support & resistance can last for a very long time.
Take a look at the blue horizontal line. You can see that this 79ish level has been a place to take notice since September of this year. Today is no exception. GPRO ran up on the drone news and has now stalled at the horizontal line. This is not coincidence. This is the way support & resistance & the markets work.
Anyone who doesn't think the hype will last probably shorted around 79ish. All I can say to them is "be careful". Anyone who thinks the rise in GPRO's price will continue should just realize that there will be some turbulence around this $79 level. Not to mention that GPRO is up over 5% on the day...
Let me also point out that the green uptrend (UT) line and the blue horizontal line will intersect by Monday. If you want to stay long, GPRO should stay above the UT line. If you are already making money, you have the luxury of making minor changes to the UT line like I suggested yesterday. But when you are in a new trade, you can't allow more loses than you were willing to take when you began the trade.
If you are thinking short is the right way to play GPRO then you have two lines of reference.
1) If GPRO really is a short, it can't close above the 79ish level.
2) If GPRO really is a short, it should close below the green UT line.
The Trend Is Your Friend... Until Its Not. Good Luck and Happy Thanksgiving.
This chart is a 60 minute chart so remember the trend lines may not last as long as those on daily or weekly charts. But horizontal lines of support & resistance can last for a very long time.
Take a look at the blue horizontal line. You can see that this 79ish level has been a place to take notice since September of this year. Today is no exception. GPRO ran up on the drone news and has now stalled at the horizontal line. This is not coincidence. This is the way support & resistance & the markets work.
Anyone who doesn't think the hype will last probably shorted around 79ish. All I can say to them is "be careful". Anyone who thinks the rise in GPRO's price will continue should just realize that there will be some turbulence around this $79 level. Not to mention that GPRO is up over 5% on the day...
Let me also point out that the green uptrend (UT) line and the blue horizontal line will intersect by Monday. If you want to stay long, GPRO should stay above the UT line. If you are already making money, you have the luxury of making minor changes to the UT line like I suggested yesterday. But when you are in a new trade, you can't allow more loses than you were willing to take when you began the trade.
If you are thinking short is the right way to play GPRO then you have two lines of reference.
1) If GPRO really is a short, it can't close above the 79ish level.
2) If GPRO really is a short, it should close below the green UT line.
The Trend Is Your Friend... Until Its Not. Good Luck and Happy Thanksgiving.
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