Looking to for an opportunity to short DD, preferably on a bounce in price, after DD formed a head and shoulders topping pattern and pierced the neckline, combined with a break below uptrend support which had been in place since the spring 2020 lows.
Upon any strength, will seek to open short position with an initial lot, being keen to add to the position just above $73 (the 23.6% Fib retracement level from the entire upward move between the Mar-2020 low and the Jan-2021 high is right around $73.36) up to approximately the $75 handle (which is below the underside of former uptrend line support now turned resistance as well as the neckline of the H & S pattern).
Downside target is near the $65 area, as a potential upside reversal zone near the psychological $65 level may come into play in addition to this area being the approximate target of the aforementioned head and shoulders pattern, as well as potential support from bulls looking to buy coming in at or around 38.2% Fib retracement level of the entire upside move from the 2020 low to the 2021 high, which is right around the $64.75 level.
Alternately, if DD price fails to sufficiently bounce high enough to trigger the aforementioned anticipated short entry zone, will look to open short position by means of a sell stop order at $72.33 (with a stop loss at 75.66 and limit/take-profit at the $64.93 level) upon a break and close below the July 2021 low of $72.35.
In summary, looking to average into short position with average entry price after multiple lots of approximately $73.23, with a stop loss at $77.13, and a target of $65.03 on the downside. Reward to Risk Ratio meets the minimum 2:1 threshold, at approximately 2.1-to-1 on this trade. The alternative scenario (immediately previous paragraph) has a R/R ratio of approximately 2.27-to-1 on that (alternative) setup.
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DISCLAIMER: I may have a personal position and/or a beneficial interest in the aforementioned instrument. The aforementioned price chart, trade details, plus any related information, is being disseminated for educational and/or informational purposes only and pursuant to the 1st Amendment to the Constitution of the United States of America and all protections thereunder. Nothing herein is intended to, nor shall in fact be, construed by anyone as any type of advice whatsoever, in any capacity, whether professional or otherwise. Moreover, I do not hold myself out to be any type of professional in any manner whatsoever, nor of holding any type of licensure, including but not limited to, licensure in the financial or legal fields - or any other field for that matter. All information contained herein is offered solely for information and/or educational purposes and should not be relied upon. Trading in the capital markets is risky. Don't put money at risk in the capital markets which you cannot afford to lose or for which a loss of capital at-risk in the markets would materially affect your financial wellbeing. See a licensed financial advisor for guidance and advice regarding investing your money, as well as any trades for which you may be interested in taking, and for help in determining whether participating in the capital markets is appropriate for your individual situation and risk profile. See a qualified attorney licensed to practice in the relevant jurisdiction regarding matters pertaining to any and all legal issues, advice, and counsel. Consider consulting with an experienced tax attorney and/or CPA regarding any and all tax implications of putting money at risk in the capital markets. Do your own vigorous due diligence before taking any action, whether financial, legal, or otherwise.
Upon any strength, will seek to open short position with an initial lot, being keen to add to the position just above $73 (the 23.6% Fib retracement level from the entire upward move between the Mar-2020 low and the Jan-2021 high is right around $73.36) up to approximately the $75 handle (which is below the underside of former uptrend line support now turned resistance as well as the neckline of the H & S pattern).
Downside target is near the $65 area, as a potential upside reversal zone near the psychological $65 level may come into play in addition to this area being the approximate target of the aforementioned head and shoulders pattern, as well as potential support from bulls looking to buy coming in at or around 38.2% Fib retracement level of the entire upside move from the 2020 low to the 2021 high, which is right around the $64.75 level.
Alternately, if DD price fails to sufficiently bounce high enough to trigger the aforementioned anticipated short entry zone, will look to open short position by means of a sell stop order at $72.33 (with a stop loss at 75.66 and limit/take-profit at the $64.93 level) upon a break and close below the July 2021 low of $72.35.
In summary, looking to average into short position with average entry price after multiple lots of approximately $73.23, with a stop loss at $77.13, and a target of $65.03 on the downside. Reward to Risk Ratio meets the minimum 2:1 threshold, at approximately 2.1-to-1 on this trade. The alternative scenario (immediately previous paragraph) has a R/R ratio of approximately 2.27-to-1 on that (alternative) setup.
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DISCLAIMER: I may have a personal position and/or a beneficial interest in the aforementioned instrument. The aforementioned price chart, trade details, plus any related information, is being disseminated for educational and/or informational purposes only and pursuant to the 1st Amendment to the Constitution of the United States of America and all protections thereunder. Nothing herein is intended to, nor shall in fact be, construed by anyone as any type of advice whatsoever, in any capacity, whether professional or otherwise. Moreover, I do not hold myself out to be any type of professional in any manner whatsoever, nor of holding any type of licensure, including but not limited to, licensure in the financial or legal fields - or any other field for that matter. All information contained herein is offered solely for information and/or educational purposes and should not be relied upon. Trading in the capital markets is risky. Don't put money at risk in the capital markets which you cannot afford to lose or for which a loss of capital at-risk in the markets would materially affect your financial wellbeing. See a licensed financial advisor for guidance and advice regarding investing your money, as well as any trades for which you may be interested in taking, and for help in determining whether participating in the capital markets is appropriate for your individual situation and risk profile. See a qualified attorney licensed to practice in the relevant jurisdiction regarding matters pertaining to any and all legal issues, advice, and counsel. Consider consulting with an experienced tax attorney and/or CPA regarding any and all tax implications of putting money at risk in the capital markets. Do your own vigorous due diligence before taking any action, whether financial, legal, or otherwise.