Take a look at the 1-year chart of Microsemi (NASDAQ: MSCC) with the added notations:
MSCC may be forming a bearish chart pattern known as a double top. Double tops are reversal patterns and are as simple as they sound: Rallying up to a point (T), selling off to a support, and then rallying back up again to approximately the same top (T).
MSCC appears to have formed the double top price pattern (blue) over the last 4 months. As with any price pattern, a confirmation of the pattern is needed. MSCC would confirm its pattern by breaking the $32 support (green) that was created by the double top pattern.
The Tale of the Tape: MSCC has formed a potential double top. A short trade could be made on a break of the $32 level. Since there is no guarantee of a breakdown, a long trade could be made at $32 if a trader is willing to disregard the pattern.
Please share this article
No comments:
Post a Comment