This chart depicts an inverse head-and-shoulders pattern, a bullish reversal signal, alongside a rising channel. Here’s a breakdown of the potential strategy based on the chart:
Key Observations:
1. Inverse Head and Shoulders:
Left Shoulder: Initial peak followed by a decline.
Head: Deeper low at "TOP 2."
Right Shoulder: Higher low compared to the head, signaling potential reversal.
2. Rising Channel:
Price is currently trending upward within a parallel channel.
3. Entry Zone:
Around $2,620.27 (highlighted area near the breakout of the neckline).
4. Targets:
First target: $2,658.13 (as marked).
Second target: Potential continuation above the rising channel if momentum holds.
5. Stop Loss:
Below $2,600.30 to mitigate downside risk in case of pattern failure.
Trading Idea:
Buy Entry: On a successful breakout above the neckline ($2,620.27) or upon retesting the lower end of the channel.
Take Profit: Scale out near $2,658.13 or higher.
Risk Management: Use a tight stop loss below the rising channel or neckline.
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