Strong Move Incoming in Mersana Therapeutics
Mersana is currently right at the resistance within a big falling wedge - a bullish pattern upon eventual breakout.
What separates this case from the normal breakout is that Mersana recently made a perfect RSI closing on the lower bullish red line. As discussed in detail in the RSI trilogy, once the RSI comes from low levels (as in below the lower bearish blue line, typically below 30) and makes a dynamic move up, just to bounce back on the lower bullish red like "a hook" (as on the picture), it's an incredibly strong sign of more to follow.
What these RSI strategies do is to identify pivotal price tops and bottom that in turn match RSI pivots. The exact RSI values (as in the lower bullish red and upper bearish blue) are extracted through accumulation and distribution phases. For the point with these levels is that they represent a form of mathematical "max pain", after which the price has a remarkably high likelihood of reversing. And right now, such reversal is very likely in play.
I have personally taken a position already. The trade signal is automatically disqualified and stopped out if the price and RSI were to drop below the lower bullish red line with a margin of at least >1%. In this case, we're talking a daily closing price of $10,75 or below.
The fantastic thing about these RSI strategies is that, once you act upon them immediately, they offer ridiculously high RR, often 50:1-100:1.
A properly executed lower bullish red acts much like a trampoline to catapult the underlying fast towards high prices. The same applies in reverse for the upper bearish blue, which in turn flashes every red light to get out of the way.
What separates this case from the normal breakout is that Mersana recently made a perfect RSI closing on the lower bullish red line. As discussed in detail in the RSI trilogy, once the RSI comes from low levels (as in below the lower bearish blue line, typically below 30) and makes a dynamic move up, just to bounce back on the lower bullish red like "a hook" (as on the picture), it's an incredibly strong sign of more to follow.
What these RSI strategies do is to identify pivotal price tops and bottom that in turn match RSI pivots. The exact RSI values (as in the lower bullish red and upper bearish blue) are extracted through accumulation and distribution phases. For the point with these levels is that they represent a form of mathematical "max pain", after which the price has a remarkably high likelihood of reversing. And right now, such reversal is very likely in play.
I have personally taken a position already. The trade signal is automatically disqualified and stopped out if the price and RSI were to drop below the lower bullish red line with a margin of at least >1%. In this case, we're talking a daily closing price of $10,75 or below.
The fantastic thing about these RSI strategies is that, once you act upon them immediately, they offer ridiculously high RR, often 50:1-100:1.
A properly executed lower bullish red acts much like a trampoline to catapult the underlying fast towards high prices. The same applies in reverse for the upper bearish blue, which in turn flashes every red light to get out of the way.