This is a classic possibility of a Double Top. Please note I have taken the trade before the trendline break. If you have not placed the trade yet you can reduce your risk by waiting for a clear trendline break. Waiting for the trendline break IS HIGHLY RECOMMENDED. Why am I short already? Sometimes you click the button to fast and BAM your in a position. (Click on the chart at the bottom of this post.… it is a must see!)
Double Tops are very common in technical analysis. Below you will see a chart of the index that tracks the S&P 500. It’s ticker is SPY. If you want to BUY the index or SHORT the index use the SPY.
The chart shown is a DAILY chart. Meaning each ‘green’ and ‘red’ candle represents the price action for 1 day. There are 365 candles in this chart representing 1 year! Notice how over the past year there were 2 possibilities for a Double Top. The two white circles indicate the first possibility. Note: The trendline did not break so this was not a time to get short. The second time, indicated by the two white squares, did have a trendline break so you could have shorted the SPY or even sold some other LONG positions you had to lock in a profit and mitigate risk!!!
A POSSIBILITY OF A NEW DOUBLE TOP IS UPON US… have a look at the chart! Using this information you can SHORT the SPY as I have (or wait until a clear trend line break) or use the information to sell LONG positions and limit your downside risk...
Double Tops are very common in technical analysis. Below you will see a chart of the index that tracks the S&P 500. It’s ticker is SPY. If you want to BUY the index or SHORT the index use the SPY.
The chart shown is a DAILY chart. Meaning each ‘green’ and ‘red’ candle represents the price action for 1 day. There are 365 candles in this chart representing 1 year! Notice how over the past year there were 2 possibilities for a Double Top. The two white circles indicate the first possibility. Note: The trendline did not break so this was not a time to get short. The second time, indicated by the two white squares, did have a trendline break so you could have shorted the SPY or even sold some other LONG positions you had to lock in a profit and mitigate risk!!!
A POSSIBILITY OF A NEW DOUBLE TOP IS UPON US… have a look at the chart! Using this information you can SHORT the SPY as I have (or wait until a clear trend line break) or use the information to sell LONG positions and limit your downside risk...
You will notice that the profitability ratio on this trade is ~1:1. I will be watching this trade closely and if it goes in our direction I will be moving the STOP to break even quickly.
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