TWX Bullish Breakout Plan is Over, Potential Squeezing Move
Hi all!
This is 3rd update to the TWX Trading Plan, which aims to capture the potential bullish breakout move of an Ascending Triangle Pattern.
RECAP
If you recall from the previous update, we saw strong price move from 88.50 to as high as 90.48, hence confirming that the breakout has occurred.
Aso the plan mentioned the below Stop loss condition.
Initial Stop Loss:
Below $85.50 OR when price does a daily close below the blue uptrend line at point 2.
Flipping Around to Short if Long Squeezed:
In the event the stop loss conditions are triggered, it will mean that the Ascending Triangle pattern has failed and loss has been incurred.
It is also likely that this failed pattern will lead to a long squeeze move with enough momentum to push prices towards $82.50 and even lower.
Therefore more advanced traders may consider turning around and go short when the stop loss conditions are triggered, to capture this long squeeze momentum.
UPDATE 3
After the previous update, price was sharply resisted at 91.00 and closed as low as 87.38 on 2015-07-24, which is below the blue uptrend line.
Therefore in effect, the Bullish plan is all but over and all Long positions should be closed.
Rationale is that if price is genuinely breaking out above, it should show a clean strong move up.
The recent price action shows that this was not the case.We would expect the Resistance to hold and not easily penetrated.
Hence, this lack of buying support indicates to me that there is a lack of strength the up move.
Although prices may eventually drift higher due to the generally bullish environment, there is no longer a good case for a good solid breakout move.
Flipping Around to Squeeze the Longs
I did mentioned that we can consider flipping around to do long squeeze move, if the stop loss conditions are triggered.
However, there are more uncertainty involved in doing a squeezing move, especially because you are trading against the general trend.
Therefore, please put a tight stop (say above 99.00), watch the support levels and always look to exit quickly.
Personally, I would choose not to do a Squeeze move.
Instead I will prefer to hunt for more potential breakout opportunities out there in the financial universe.
On the flip side, it might add value to put in a small position for squeezing, so that you can experience what it feels like to go out there and Squeeze out other people's positions.
Reference:[lb]
Short Squeeze 1: investinganswers.com/financial-dictionary/real-estate/short-squeeze-2045
Short Squeeze 2: traderhq.com/understanding-short-squeeze-and-how-to-profit/
Like it, Share it, Follow it~
Trading View: BreakOutArtist
StockTwits: stocktwits.com/BreakOutArtist
Twitter: twitter.com/BrkOutArtist
This is 3rd update to the TWX Trading Plan, which aims to capture the potential bullish breakout move of an Ascending Triangle Pattern.
RECAP
If you recall from the previous update, we saw strong price move from 88.50 to as high as 90.48, hence confirming that the breakout has occurred.
Aso the plan mentioned the below Stop loss condition.
Initial Stop Loss:
Below $85.50 OR when price does a daily close below the blue uptrend line at point 2.
Flipping Around to Short if Long Squeezed:
In the event the stop loss conditions are triggered, it will mean that the Ascending Triangle pattern has failed and loss has been incurred.
It is also likely that this failed pattern will lead to a long squeeze move with enough momentum to push prices towards $82.50 and even lower.
Therefore more advanced traders may consider turning around and go short when the stop loss conditions are triggered, to capture this long squeeze momentum.
UPDATE 3
After the previous update, price was sharply resisted at 91.00 and closed as low as 87.38 on 2015-07-24, which is below the blue uptrend line.
Therefore in effect, the Bullish plan is all but over and all Long positions should be closed.
Rationale is that if price is genuinely breaking out above, it should show a clean strong move up.
The recent price action shows that this was not the case.We would expect the Resistance to hold and not easily penetrated.
Hence, this lack of buying support indicates to me that there is a lack of strength the up move.
Although prices may eventually drift higher due to the generally bullish environment, there is no longer a good case for a good solid breakout move.
Flipping Around to Squeeze the Longs
I did mentioned that we can consider flipping around to do long squeeze move, if the stop loss conditions are triggered.
However, there are more uncertainty involved in doing a squeezing move, especially because you are trading against the general trend.
Therefore, please put a tight stop (say above 99.00), watch the support levels and always look to exit quickly.
Personally, I would choose not to do a Squeeze move.
Instead I will prefer to hunt for more potential breakout opportunities out there in the financial universe.
On the flip side, it might add value to put in a small position for squeezing, so that you can experience what it feels like to go out there and Squeeze out other people's positions.
Reference:[lb]
Short Squeeze 1: investinganswers.com/financial-dictionary/real-estate/short-squeeze-2045
Short Squeeze 2: traderhq.com/understanding-short-squeeze-and-how-to-profit/
Like it, Share it, Follow it~
Trading View: BreakOutArtist
StockTwits: stocktwits.com/BreakOutArtist
Twitter: twitter.com/BrkOutArtist
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