$NU - Uptrend Commencing+14.73% MoM at the moment of editing. But more important than this percentual gain is what this candle represents.
This market had been ranging between the $3.5 & $5.5 thresholds for the past 12 months after a brutal sell off.
This month, after a shy breakout above the 10 EMA (M), this market is trading close to $6, with that proud green candle breaking above the above mentioned resistance threshold, making new high highs and announcing what could be the start of an uptrend.
Noteworthy is the fact that we are barely in the equator or the month, the time frame used for this analysis ... It goes without saying that we need a closed candle in order to draw firmer conclusions.
No less important, despite the curiosity triggered by this breakout, a careful examination of this market tells us that it has heavy overhead supply and also that the upcoming logical target (zone where the odds of the bears stepping in this market increase),entails that a bullish swing trade would have a poor risk to reward ratio ... if of course we place our stop loss in a logical place as well (below the $5.50 threshold - as previous resistance and new support, always with sufficient buffer).
Having this said, now comes the moment when I alert you for the complexity of the world and the financial markets. No Nobel prize, prime trader, financial institution or whatsoever, knows what's going to happen tomorrow. This is a game of probabilities and risk management. If your trade has 60% odds of succeeding (which are actually very good odds), it still means that you ought to expect 4 losses out of every 10 trades in the long run. 4 out of 10 are still pretty significant numbers. Can you really afford to place a bulky share of your capital at this risk? You need to stay alive to allow the good side of the odds to help you out here. So manage risk at all costs and make it your priority.
Cheers,
Tenacious Tribe - Backtested Trading Strategies & Studies
50% discount on all of our products, in our web, with the following code:
MOX Q3C WXRX
