Lockheed Martin Bull Pennant
Updated
This is a monthly chart of the defense company Lockheed Martin (LMT).
As you can see, a bull pennant is appearing.
In my experience, I have found that the most valid bull flags or pennants usually retrace back to the Golden Ratio (0.618), then bounce and continue higher (see below chart).
When this occurs, the measured move up is typically one full Fibonacci spiral from this retracement level, which usually occurs over a period of time that is about the same as the period of time it took the bull flag or pennant to form (see below chart)
The above chart suggests that LMT could climb into the 500s or as high as about 600 by the second quarter of next year. The best time to enter a trade would probably be after the seasonal volatility ends, and after a breakout occurs on some lower timeframe.
From a regression standpoint, this bull pennant formed when price rose from the mean to the 1 standard deviation, and retraced to the 0.5 standard deviation. If it pans out, the measured move may reach one full standard deviation higher (to the 1.5 standard deviations). See below chart.
To learn more about the log-linear regression channel that I used here, you can check out my prior post that described it in more detail:
Obviously, anything can happen. Not trading advice. Please do your own research and trade at your own risk. If you disagree, I welcome respectful comments and charts below.
Disclosure: I have no trade position in LMT and do not plan to open any trade at the current time.
As you can see, a bull pennant is appearing.
In my experience, I have found that the most valid bull flags or pennants usually retrace back to the Golden Ratio (0.618), then bounce and continue higher (see below chart).
When this occurs, the measured move up is typically one full Fibonacci spiral from this retracement level, which usually occurs over a period of time that is about the same as the period of time it took the bull flag or pennant to form (see below chart)
The above chart suggests that LMT could climb into the 500s or as high as about 600 by the second quarter of next year. The best time to enter a trade would probably be after the seasonal volatility ends, and after a breakout occurs on some lower timeframe.
From a regression standpoint, this bull pennant formed when price rose from the mean to the 1 standard deviation, and retraced to the 0.5 standard deviation. If it pans out, the measured move may reach one full standard deviation higher (to the 1.5 standard deviations). See below chart.
To learn more about the log-linear regression channel that I used here, you can check out my prior post that described it in more detail:
Obviously, anything can happen. Not trading advice. Please do your own research and trade at your own risk. If you disagree, I welcome respectful comments and charts below.
Disclosure: I have no trade position in LMT and do not plan to open any trade at the current time.
Note
Was alerted by akikostas that price already broke out of this bull flag pattern. It's interesting how chart analysis can give us high-probability predictions of future price action.
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