DoubleBottom Channel Breakout Trend Reversa, Volume Confirmed
BIIB has been in a downtrend for about 9-months. In March was the formation of a double bottom with volume confirming a reversal (left most green arrow). In May was the formation of a new lower high. This is confirmation that a new bullish trend is underway. On Tuesday, May 31st BIIB broke out both above the 200 SMA and and out of the downtrend channel on confirmed volume.
I am going to catch the next lower high and place my stop below the trend line:
Trigger (.5 fib): 264.44
Stop (.382 fib): 259.47
Target: $327.71
This trade has a reward: risk of 12:1. There is way more upside if you believe that all gaps are eventually filled or come close to being filled.
If the stock does not trigger because my trigger is too low I will look for a new entry along the lower black trend line.
I am going to catch the next lower high and place my stop below the trend line:
Trigger (.5 fib): 264.44
Stop (.382 fib): 259.47
Target: $327.71
This trade has a reward: risk of 12:1. There is way more upside if you believe that all gaps are eventually filled or come close to being filled.
If the stock does not trigger because my trigger is too low I will look for a new entry along the lower black trend line.
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Just a huge bearish gap today after such a promising chart pattern. I will not get into this trade as a result of the gap down.