GLAXO | FAKEOUT OF DESCENDING TRIANGLE?
Updated
The descending triangle is a pattern that leads to big explosive moves once price breaks out either side of the triangle.
Here in Glaxo, the price does seem have to broken to the downside, but the candles formed in the yellow box above, do seem to suggest a fake breakdown.
The formation of a Bullish Harami cross, with heavy volumes suggest more buying down there.
(A Bullish Harami formation is when there is an inside bar formed next to a bearish mother candle, and the next candle crosses the high of the Mother candle)
A stochastic crossover in the Oversold zone also suggests buying coming in instead of selloff
POINTS TO NOTE BEFORE INITIATING LONG:
1. A breakdown of a descending triangle, yet the follow-up selloff is missing.
2. Formation of a Bullish Harami Cross suggesting buying
3. A stochastic crossover in the Oversold zone.
4. Last but not the least, if it does turn out to be a fakeout, the RR is close to 5.5. (Considering the target after a successful breakout to the upside as the pattern height)
Considering the above points, a long can be initiated as follows:
Entry 1450
SL 1370
Targets 1870
RR 1:5.5
As always trade according to your risk appetite. And always enter your SL first.
Here in Glaxo, the price does seem have to broken to the downside, but the candles formed in the yellow box above, do seem to suggest a fake breakdown.
The formation of a Bullish Harami cross, with heavy volumes suggest more buying down there.
(A Bullish Harami formation is when there is an inside bar formed next to a bearish mother candle, and the next candle crosses the high of the Mother candle)
A stochastic crossover in the Oversold zone also suggests buying coming in instead of selloff
POINTS TO NOTE BEFORE INITIATING LONG:
1. A breakdown of a descending triangle, yet the follow-up selloff is missing.
2. Formation of a Bullish Harami Cross suggesting buying
3. A stochastic crossover in the Oversold zone.
4. Last but not the least, if it does turn out to be a fakeout, the RR is close to 5.5. (Considering the target after a successful breakout to the upside as the pattern height)
Considering the above points, a long can be initiated as follows:
Entry 1450
SL 1370
Targets 1870
RR 1:5.5
As always trade according to your risk appetite. And always enter your SL first.
Trade closed: stop reached
Related publications
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.