Using TA to time entries and exits

[Hoop]

AIR has broken out..
Xerof..I.m not convinced this was a bona fide CwithH pattern...It could be lead in to a possible Bump and Run pattern (assumption)...There was a 5 month downtrend which had a 2 day rally (1 week on the weekly chart) ..is that considered long enough to be an uptrend into the start of this pattern?... One of the guidelines for this bullish continuation pattern is there has to be an established uptrend of at least 30% leading into the CwithH pattern...Also...often Chartists look for CwithH using a weekly chart then zoom in into a daily chart. On the AIR weekly chart it is hard to identify a CwithH pattern

To me (splitting hairs here) I think this is a CwithH look alike pattern which probably has similar trading behavioural attributes and outcomes so I shouldn't be too pedantic about it... so Xerof it's good enough for me...Analysing a target price for a look alike pattern?...Hmmm

Bullowski says a CwithH in a bull market environment (NZX50) is not great but reasonally reliable pattern. It has a low failure rate (5%) (<5% breakout rally) but has a poor history of reaching its target price...The breakout has a 42% of a throwback to the cup lip (so not good chance for me to enter again now as a profitable investment)..The percentage chance a true CwithH pattern has in meeting its target price [measure rhs cup lip from bottom of cup] of $2.51 is only 50%!!! ...

Why 50% probability meeting its target price ($2.51)???..

Looking at AIR chart there is a long term (20 month) resistance zone at $2.30/$2.40 with 6 touching points (sign of reasonable strength) and a long term (19 month) resistance line at $2.50 with 7 touching points and one gap..the gap is a powerful point and is also a warning area as this price area will in the future will have a higher probability of producing gap up or down events..

So..resistance areas do affect the price target performance..as will as other resistance lines e.g MA and down sloping trend lines

Bullkowski offers a better price target measurement which divides the TP measurement by the 50% probability figure...$2.39...This price has a 76% chance of being met....Notice this price is at AIR's resistance zone..

Note:.. Bullowski's stats are from the S&P500 analysis
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