Broadening Formation, Right-Angled and Ascending
Identification:
*Short-term Bearish*
Shape: Looks like a megaphone with the base horizontal
Trend Lines: A horizontal (or nearly) bottom line (support) connects the bottom lows. An up-sloping trend line (resistance) connects higher highs.
Once recognizing the formation:
When the price is going up:
Buy the Breakout Up: Set buy order above Upper Trend (resistance) line.
If the Breakout Fails:
Go short at the High: Sell short after the price starts heading down from the top of the trend line.
When the price is going down:
Sell the Breakout Down: Set a sell order below the horizontal Bottom Trend (support) line.
If the Breakout Fails:
Go Long at the Low: Buy after the price starts heading back up.
Partial Decline or Rise: A partial decline from the top, or a partial rise from the bottom is a reliable breakout signal. On a partial decline from the top, go long; on a partial rise, go short.
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