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£AZN 1-day classic patternsQ: What has the highest probability of occurring? After being one of the strongest performers in 2020 during the initial UK lockdown the stock lost over 30% of its value. In 2021 it has staged a modest recovery but is still over 15% below its all time high requiring an over 20% rally. There is well tested support at 8100p and resistance at 8775p. There is 2 classic patterns 1 that has not validated. 1 that has validated. The bull flag, with a breakout of 8775p, stop at 8100p, and projected target at 10150p. A risk-to-reward ratio of 2R. The breakout from the bull flag needs to be confirmed by a close outwith both the flag and resistance. A difficult task therefore requiring more time to confirmation. The double top, with a breakout of 8100p, and projected target at 7400p. Using a stop half the size of the range creates a 2R opportunity. The stock also pays a 2.48% dividend semi-annually. Given the length of the setup this trade may run deep into 2022 to allow that dividend to be collected. Although before that point there will be 2 earnings releases adding volatility to any potential positions held. The short trade is therefore not of interest here however considering it has validated this may act as a catalyst for the long side. But again it is not yet validated.
LSE:AZNLong
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