I love it when I see trades line up with multiple confirmations.
- Multiple trendlines that line up at or near exactly where you are considering an entry are very powerful.
- Additional confirmation with indicators add extra weight towards the case of entering a trade.
Case in point…GIS. Take a look at this chart:
We have a stock that has been in a downtrend for quite some time, within the red trading range. At this point the price has reached a point where it also lines up with prior support, at lows that line up with the horizontal blue support line.
Here we have 2 confirmations of support, where we might see a bounce!
I got into GIS a bit too late, a few days after my first tweet where I listed a few charts that I liked…GIS was one of them, on 9/3/17. Got too busy at work to take advantage. Got in after a good move, but still, I think this has some room to run further.
Also, I got into another trade (also a bit late) with COE, that was also one of the stock charts I liked on 9/3.
Take a look at that chart:
This chart is absolutely perfect. Love the sharp declines, which always seem to lead to sharp bounces back up. Look at how COE bounces hard after hitting the $13 range. Got in a too late at $14.52 on 8/6, but oh well. Has room to run to $16, where there is resistance at prior lows.
In the same theme as GIS above, look at how there is another confirmation, this time with an indicator I love to use, Bollinger Bands. It hit the extreme lower band, priming for a bounce.
Awesome right! Well see how these late entries work out. My risk/reward is now higher than it should have been because of my late entries, but I still think there’s some room.
Good luck & let me know your thoughts on your trading results when you see multiple confirmations pointing towards one direction…UP!