Costco the case for higher highs maybe probableHI guys. This is an analysis thread to assess the technical developments found in Costco. I will layout some general findings on the macro scale, then update as new developments proceed in the technicals for COST. The purpose is to provide unbiased TA opinions, where i give both bearish or bullish cases depending on facts in charts to help make informed trading/investing decisions.
Initial analysis will be on the 1 week timeframe.
First things first. The 2 Ascending triangle patterns found.
A blue one
A black one
Notice the Black triangle, this is a larger or more influential pattern developing since May 2022.
It holds more wait if signs show we a breaking out of this.
Targets would be $680-720 range.
Confirmation of a test of support Above the horizontal upper black trendline is needed.
This would indicate a continuation of COST previous uptrend, as Ascending triangles when confirmed are strong continuation patterns.
The smaller Blue Ascending triangle seems like a intermediate term consolidation area as well.
Notice how prices have consolidated Above the Black horizontal trendline of the bigger triangle, for weeks.
We have closed Last week ABOVE Blue triangle. We must await confirmation of this breakout.
This could mean we are breaking out of both Triangles.
Look also to the 21 EMA (Purple colored moving average).
We have recently bounced off of a support test. This is a great sign.
This can be a future support test area also. But i always look at it as a level of defence. It has moved up to the $550 level.
Overall, $550 level is critical support level now. Below it we go back into the larger ascending triangle, if we do go back below, this would indicate a fakeout.
An important thing to observe is VOLUME.
For this move to follow through, we must see an increase or spike in volume. Which currently doesn't seem like its there. Which could lead to a fakeout. So we must pay attention.
Remember Volume can really make or break a move especially a chart pattern.
Momentum indicators STOCH RSI and MACD are showing signs of bullishness
STOCH RSI has a BULLISH CROSS.
MACD is attempting to cross Bullish. If MACD crosses, this will give signs that uptrend is now more likely.
Taking positions must be done after COnfirmation or a decisive move Up.
Never take positions inside of a chart pattern, always consider entering after confirmation of breakout.
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Thank you for taking the time to read my analysis. Hope it helped keep you informed. Please do support my ideas by boosting, following me and commenting. Thanks again.
Stay tuned for more updates on COST in the near future.
If you have any questions, do reach out. Thank you again.
DISCLAIMER: This is not financial advice, i am not a financial advisor. The thoughts expressed in the posts are my opinion and for educational purposes. Do not use my ideas for the basis of your trading strategy, make sure to work out your own strategy and when trading always spend majority of your time on risk management strategy.
