Cup and Handle Earnings 2-25 BMOEarnings before market open on the 25th.
We all know BBY can beat and still go down of miss and go up, or vice versa.
Targets for C&H pattern are based on the depth of the cup by subtracting the prior cup high from the cup low. I add 10 cents as a rule to that for a long entry level to try and avoid the R that may lurk there. I then add targets break out level verses the cup high using fib levels. Some may do this process differently.
To get mid cup which is a good source of support if the handle low fails, take that number and divide by 2.
It is hard to say Long when earnings are coming up because you just never know the market's response. Many of the stocks that have fallen after an earnings beat recently were in rising wedges or they were parabolic. Then others that are in a bullish pattern but still fall after a beat..so go figure (o:
There is also an inverted cup and handle pattern as well.
There have been a few rising wedges, but it appears BBY has broken bottom trendlines of each so far and recovered. Rising wedges are usually a terminal pattern as there are not many, in some case practically no one, left to buy the stock when pull back comes because they already bought it. It is usually popular stocks that gets stuck in these wedges it seems. This pattern interrupts supply and demand, but can be a very long term pattern. It is not valid until the bottom converging trendline is broken, and they usually slip out eventually. A strong stock may not fall too far..ie..NEE..I am hoping it's fall will be complete soon as it has broken the bottom trendline of it's own RW recently.
Not a recommendation.
Having a plan helps me know what I need to do if price goes up or if price goes down. Because a plan should include your targets d what price you want to get out if it turns on you, and they do sometimes. Some jot down the date they bought it and why they bought it as well as the profit and loss after selling. I look back and see what anything I need to be careful about in the future.
Without a plan you can lose your chips, then you can not play anymore (o:
