SNAP Bull breakout or Bear Flag?
SNAP is in a strong bear trend from the open (IPO). These types of stocks are very risky to buy because they rarely convert into a strong and healthy bull trend. Most of the time if you look at many stocks, they remain in some sort of bear trend or large trading range. This makes trading and profiting very difficult for most traders.
However, over the past 6 months or so, SNAP has reversed up from a large high 2 / parabolic wedge reversal. This usually leads to two legs sideways to up. Prices are currently testing above the sell climax, but this is a risky location to start buying. This is where bears will look to sell again, and the bulls who bought lower will likely begin to take profits. The bears still have open gaps above around 18. If this gap stays open, it will increase the probability of another bear leg down and possibly a larger wedge. Less likely, the bulls get a strong breakout and prices continue higher without first pulling back. The bulls will look to form a double bottom around the 10 low for the second bull leg up. Most likely, prices will convert into a large bear flag trading range and test up and down with no clear direction.
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However, over the past 6 months or so, SNAP has reversed up from a large high 2 / parabolic wedge reversal. This usually leads to two legs sideways to up. Prices are currently testing above the sell climax, but this is a risky location to start buying. This is where bears will look to sell again, and the bulls who bought lower will likely begin to take profits. The bears still have open gaps above around 18. If this gap stays open, it will increase the probability of another bear leg down and possibly a larger wedge. Less likely, the bulls get a strong breakout and prices continue higher without first pulling back. The bulls will look to form a double bottom around the 10 low for the second bull leg up. Most likely, prices will convert into a large bear flag trading range and test up and down with no clear direction.
If you found this helpful, please like and share. Feel free to comment or ask questions.
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