Monthly island reversal in the making?
I was looking over some monthly charts today (in candlestick format) and this one stood out to me on the monthly as a possible topping pattern...a monthly island reversal. On the 1st trading day in June 2024 SMH gapped up but then on the first trading day in August 2024 it gapped down creating a visual island reversal look. Technically speaking I think Island Reversal gaps do not clear but instead "gap and go" so I'm sure someone will correct me if this is the case but visually speaking (if and only if this is a top) one could look back and suggest this to be the case after the fact.
And July 2024 created an "inside month"...another possible sign of a reversal.
If the gap down is no longer present at the end of August then I will stop myself out of this trade but it's worth a small short IMO.
And July 2024 created an "inside month"...another possible sign of a reversal.
If the gap down is no longer present at the end of August then I will stop myself out of this trade but it's worth a small short IMO.
Note
Upon further look, an inside month was not created in July as July opened slightly above Junes closingNote
This no longer looks like an island reversal in the making...typically island reversals are strong reversals that end up continuing and not stalling out like this chart is doing right now.
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