Stalking Two Setup Trades
When I'm looking to enter a stock on a pullback, one of the first things I look at is the prior corrective swings within the trend. Since we are looking at a pattern of higher highs and higher lows, which is considered an uptrend, I am looking for the prior corrective declines within the uptrend. Note that on the first chart of Expedia (EXPE) below, I have labeled a few of these prior declines. You can see swings between $7.09-$9.58. I have projected 100% of these prior swings from the most recent high made on Feb. 5, 2013.
Expedia (EXPE) -- Daily 1 Source: Dynamic Trader View Chart » View in New Window »These measured moves or "symmetry" projections help identify areas where we can look for possible support, since many corrective swings can be similar. Besides running the projections, I also run all possible Fibonacci retracements and extensions and then see where they overlap. A zone that has quite a few overlapping price relationships indicates a key support decision. I see two standout zones at this point on the daily chart. Let's take a closer look at these on the second chart below....374 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.
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