Bullish Penant Breakout possibilities 62-65
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A bullish pennant has formed after a strong upward move (flagpole), indicating a period of consolidation. This is a continuation pattern, typically followed by another leg upward equal to the flagpole's height. The breakout is likely to happen this week, given that the pennant is near its apex. RSI and other momentum indicators show strength but are not yet overbought, giving room for further upside.
Breakout Confirmation: Enter a long position when the price closes above $56.50 on high volume (breakout level). Alternatively, aggressive traders can scale into a position slightly before the breakout if momentum indicators show bullish strength.
Profit Target Calculation:
Flagpole Height: $50.50 (low of the previous move) to $56.50 (high) = $6.00.
Breakout Target: Add the flagpole height ($6.00) to the breakout level ($56.50):
Primary Target: $62.50
If momentum remains strong, extend to $65.00 as a stretch target.
Stop-Loss Placement:
Place a stop-loss slightly below the pennant's lower support level at $54.50, allowing for minor fluctuations.
Risk-Reward Ratio: Aim for a 1:3 or higher ratio by maintaining a tight stop relative to your profit target.
The breakout is expected within the next few trading sessions as the price action nears the pennant's apex.
Volume should confirm the breakout (look for 2x average daily volume).
Trade Management:
Partial Take-Profit:
Sell 50% of the position at $60.00 to lock in profits.
Adjust stop-loss to breakeven on the remaining position.
Trail Stop:
Use a trailing stop-loss as the price approaches $62.50–$65.00 to maximize gains while protecting profits.
If the price breaks below $54.50, it invalidates the pennant pattern and may indicate a reversal.
I have taken an aggressive position targeting
AFRM 11/29/24 65C @.77 contracts.
I will update as I close the position profit or loss.
Breakout Confirmation: Enter a long position when the price closes above $56.50 on high volume (breakout level). Alternatively, aggressive traders can scale into a position slightly before the breakout if momentum indicators show bullish strength.
Profit Target Calculation:
Flagpole Height: $50.50 (low of the previous move) to $56.50 (high) = $6.00.
Breakout Target: Add the flagpole height ($6.00) to the breakout level ($56.50):
Primary Target: $62.50
If momentum remains strong, extend to $65.00 as a stretch target.
Stop-Loss Placement:
Place a stop-loss slightly below the pennant's lower support level at $54.50, allowing for minor fluctuations.
Risk-Reward Ratio: Aim for a 1:3 or higher ratio by maintaining a tight stop relative to your profit target.
The breakout is expected within the next few trading sessions as the price action nears the pennant's apex.
Volume should confirm the breakout (look for 2x average daily volume).
Trade Management:
Partial Take-Profit:
Sell 50% of the position at $60.00 to lock in profits.
Adjust stop-loss to breakeven on the remaining position.
Trail Stop:
Use a trailing stop-loss as the price approaches $62.50–$65.00 to maximize gains while protecting profits.
If the price breaks below $54.50, it invalidates the pennant pattern and may indicate a reversal.
I have taken an aggressive position targeting
AFRM 11/29/24 65C @.77 contracts.I will update as I close the position profit or loss.
Transaction en cours
Closet out partial 11/29/24 65C @1.70 ~ 120% gains and leaving runners into next week.Trade fermée: cible de profit atteinte
Closet all out for a pullback 11/29/24 65C @2.78 250% gains.
Thank you
AFRM !
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