My Chart of the Week is Direction Daily Semiconductor Bull 3X Shares (SOXL).
And, like last week, I’m seeing another confluence of patterns.
The first is an inverse head and shoulders pattern.
The price moved up through the neck line (light blue line), setting up a price target above the neck line equal to the distance of the move from the head to the neck. You can see this illustrated with 2 big blue arrows.
Playing the pattern out to its full potential yields a target price of $39
The 2nd pattern is a smaller “measured bounce” pattern that I teach as part of my Fibonacci Class (if you are interested you can check out the link – http://jeffrytrader.com/fib ). This is a move up and a retrace to a certain fib level that holds, leading to a resumption of the initial trend.
For our SOXL chart today that trend resumes above $18.50 (our entry) and gives us a conservative target of $27 and a more aggressive target at $33.
Now you want to wait for the entry once again, because the whole pattern can break down if SOXL trades below $10.
Hope you have a great week!