Naspers - Dip below 200dma
Price has returned to and area of interest, a major horizontal support and just below the 200 dma.
Judging by the way Tencent is trading this morning, an attempt is likely going to take place to push back towards R3110 or the gap left behind now at R3145.
Losing this major support opens the gate to a possible double top playing out.
A double top pattern is a bearish reversal pattern commonly observed in technical analysis of financial markets, such as stocks or cryptocurrencies. It consists of two price peaks that reach a similar level on a price chart, separated by a temporary decline in between. The pattern is considered a warning sign that an uptrend may be losing momentum and that a potential trend reversal to the downside could occur.
Here's a brief explanation of the key components of a double top pattern:
1. First Peak: The pattern begins with an uptrend in the price of an asset, where it reaches a peak (high point).
2. Decline: After the first peak, the price typically experiences a decline as some investors start selling, leading to a temporary pullback.
3. Second Peak: Following the decline, the price rallies again and approaches a level close to the first peak but fails to surpass it. This forms the second peak, and it's often not as high as the first one.
4. Neckline: The line connecting the lowest points of the decline in between the two peaks is referred to as the "neckline."
5. Confirmation: A trader may consider the double top pattern confirmed when the price falls below the neckline, suggesting a bearish reversal. This breakdown is often accompanied by increased trading volume.
Traders and analysts use double top patterns as a signal to potentially sell or short an asset because it suggests that the prior uptrend has weakened, and a downtrend may be starting. However, like all technical patterns, it's essential to consider other factors, such as market conditions and additional technical indicators, to make well-informed trading decisions.
Judging by the way Tencent is trading this morning, an attempt is likely going to take place to push back towards R3110 or the gap left behind now at R3145.
Losing this major support opens the gate to a possible double top playing out.
A double top pattern is a bearish reversal pattern commonly observed in technical analysis of financial markets, such as stocks or cryptocurrencies. It consists of two price peaks that reach a similar level on a price chart, separated by a temporary decline in between. The pattern is considered a warning sign that an uptrend may be losing momentum and that a potential trend reversal to the downside could occur.
Here's a brief explanation of the key components of a double top pattern:
1. First Peak: The pattern begins with an uptrend in the price of an asset, where it reaches a peak (high point).
2. Decline: After the first peak, the price typically experiences a decline as some investors start selling, leading to a temporary pullback.
3. Second Peak: Following the decline, the price rallies again and approaches a level close to the first peak but fails to surpass it. This forms the second peak, and it's often not as high as the first one.
4. Neckline: The line connecting the lowest points of the decline in between the two peaks is referred to as the "neckline."
5. Confirmation: A trader may consider the double top pattern confirmed when the price falls below the neckline, suggesting a bearish reversal. This breakdown is often accompanied by increased trading volume.
Traders and analysts use double top patterns as a signal to potentially sell or short an asset because it suggests that the prior uptrend has weakened, and a downtrend may be starting. However, like all technical patterns, it's essential to consider other factors, such as market conditions and additional technical indicators, to make well-informed trading decisions.
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