After recently breaking down and successfully re-testing a multi-year uptrend channel, confirming a new primary downtrend, NVO has now pushed back up to a key resistance area while forming a bearish rising wedge pattern (with negative divergence on the MACD and CMF confirming…not shown on this chart). Odds favor a downside resolution of this pattern unless NVO can make a sustained break out of the wedge pattern and above the marked resistance zone.
Aggressive traders could short here with a stop on a solid close above the 120.60 resistance level while conservative traders could wait for a confirmed breakdown of the wedge pattern’s lower trendline. Primary target is the support line at the 102.80 which also lines up perfectly the with pattern projection (assuming a breakdown within the next week +/-). If the target is hit, that would produce a gain of approximately 14% from current levels.
