Potentially Fund a New Phone with 250 Apple Shares & This Idea

25 thg 1, 2015

Hi all Risk Takers,

Here's an idea written for short term traders, tech stock investors and all Apple fans.

(1) On the 1 Hourly Chart, we observed clearly that price is trading in a general uptrend line, since May 2014.
Evidence of Support are found during May 2014 and Oct 2014 (Up arrows).

There are also signs of potential support around Jan 2015 period but requires a further move on the upside to confirm. Hence the dotted lines.

In short, we establish that price is trading in a bullish environment, on the hourly chart.

(2) We note a Triple Bottom patterned with a slanted neckline formed.

This Triple Bottom is confirmed as price has traded past the slanted neckline and closed over the weekend above resistance level of 112.00.

Since Triple Bottom is a reversal pattern, therefore it indicates that the party's over for the Apple bears and price has switched back to full on bullish mode.

Psychologically, we humans are inclined to attached importance on the number "3", hence Triple Bottoms are a much more significant reversal pattern by nature.

To explain the thinking, simply put yourself in the shoes of an Apple bear.
Assumed you had went against the bullish trend and shorted heavily Apple 3 times, yet price refuses to go lower than 105.00, you will most likely stop trying for a fourth attempt to short.

This might also explain the absence of a so called "Quadruple Bottom Chart Pattern" in Technical Analysis literature.

To summarize point (2), we spotted a confirmed Triple Bottom Chart Pattern.

(Projection)
Since the trend is overall bullish (1) and we have breakout confirmation of a significant Triple Bottom Pattern (2), price is projected to trade up higher.

(Entry Condition)
Anytime from now, as long as price is trading above 112.00.

(Stop Loss)
Below 111.30.
The stop may be a bit tight.
However if this is a true to form Triple Bottom Breakout, then price should not even be thinking of going back any lower.

(Take Profit)
Take profit is set at 118.90.
The triple bottom will most likely drive the price to at least try to match previous high of 118.90.

(Risk)
There is a risk of a false break out, where price gets sharply resisted at 115.00. and fail.
From personal experience, Weighing the strength of a simple resistance line vs triple bottom breakout, I will say advantage to triple bottom.

There is also a risk that fundamental information disclosed during the upcoming Earnings Announcement, on 27 January 2015, may cause prices to move in an averse manner.

Technical Analysis simply cannot project fundamental events (Example: CHF/EUR).

(References)
Triple Bottom> thepatternsite.com/tb.html
youtube.com/watch?v=cNFDh96DuZw

(Trivia)
If you bought 250 Apple Shares at 114.00 and managed to sell it off at 118.50, you will most likely have enough profit for a new iPhone 6 Plus without contract.

Like it, Share it, Follow it~

StockTwits: stocktwits.com/BreakOutArtist
Twitter: twitter.com/BrkOutArtist
TradeHero: BreakOutArtist