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CHK: Round 2?

CHK (Chesapeak Energy Corp) was a recent official long trade (March 2nd - 3rd) that hit the final target for a 49% gain in less than 24 hours from entry. After kissing the downtrend line & pulling back within this falling wedge pattern, the stock now looks ready for the next thrust up.

CHK daily April 11th

CHK daily April 11th

As the stock has started to move in pre-market, I'm going to wait see how it opens before deciding whether or not to add this as an official trade idea. Whether I do or don't, for those interested, my initial & minimum price target would be that same downtrend line from the previous trade which currently comes in right around the 5.00 resistance level & my stop would be on move below 3.65, possibly higher, depending on my entry price.

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Apr 11, 2016 8:41am|Categories: Equity Market Analysis|Tags: |2 Comments

2 Comments

  1. pangblood April 11, 2016 9:26 am at 9:26 am

    Could this also be a bullish pennant? Also I’m guessing this trade would imply some more head room for the energy sector and oil.

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    • rsotc April 11, 2016 11:52 am at 11:52 am

      Could be a bullish pennant although a bit on the bigger end in size (relative to the flagpole) of what some might consider a pennant. Regardless, the net effect is the same whether it is a pennant or a falling wedge: A break above (which we have today) is a bullish technical event.
      I had started buying CHK in pre-market with the intention of adding but I’d like to see some follow-thru with more impulsive buying, especially a pop over the earlier highs from this morning before adding.

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