WFCD trade ideas
WFC is rolling over with 39 then 36 possible by year endMaybe technicians will also call this a head&shoulders top formation, but either way you look at it - it is running into selling pressure and the stock is being "distributed" by long term holders. The new buyers are being tested here to see if they can absorb all of the selling pressure from the long term profit-takers.
This "forecast" may be a bit on the extreme side of the forecast as I drew the top line first, then the bottom line. However, I doubt it will get to the "massive support level" I have labeled - but at least a move towards it into the end of the year would make sense to me.
Risk: 3 Average Daily Ranges (11-day avg of high-low true range).
As for the whole market: Here is a simple pattern that has been useful to follow for decades.
The usual pattern is: First goes the bond market (down big this year), then banks and financials follow, then industrials, then transportation, then everything else. Technology is always last in major bull markets. For example. Microsoft hit new highs until a week before the stock market crash in 1987. So, don't be lulled into thinking that because new era stocks are surging (FB, AMZN, Biotech, Internet vapor stocks) that the market is fine. I'm not forecasting a melt-down or a crash at all... just a sideways to lower market for the next year or so to let the market grow into its valuation.
Until next time: Happy Trading
Tim 12:16PM EST, Thursday, September 26, 2013
WFC monthly CLONE analysis Current candle stick price action is bullish. Fisher is in the high end range but still rising with no divergence.If WFC can break reference channel 1 to the upside, the near term price target is top of CLONE 2A. If we get bearish candle stick action in the current CLONE confluence area WFC could correct down to bottom of reference channel 1. If WFC breaks CLONE confluence to the upside the longer term target is top of 1A CLONE and or top of 2B. You can use your favorite indicator(s) or method to further validate CLONE action.
