Monday, July 18, 2005

XWG cup & handle pattern may resolve soon

The Knight Trader has recently posted XWG's chart illustrating a possible cup & handle on the daily candlesticks. That pattern looks like it may resolve to the upside over the next couple of days. I'm already carrying a 2-lot position in XWG, I started my buying pretty close to the bottom of the cup when the descending upper-channel line broke.

If buyers get into a panic causing a breakout over its new upper-channel line (across the top of the cup) and into new 52-week highs, I'll probably add to the position again. Averaging up is a double-edged sword, it may cost me a lot of my current gains if the stock falls apart, but if I'm right about it moving up then I stand to make far more money.

2 Comments:

At 9:36 PM, Blogger sung said...

Let's hope it will head higher from here. I bought and sold and bought again.

Cheers.

 
At 10:35 PM, Blogger jontait said...

Yea I'm still with it. I did not make a breakout buy today though, the volume was clearly not enough. I think it may go a little higher, but not into new highs, and make another handle that is longer before breaking out. That is probably the most bullish case anyway. If it breaks out from here it will get overheated quickly.

 

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