here’s an updated chart of EGLE in which i adjusted the primary downtrend line for a more accurate fit (the one shown on the previous chart was an old one that i had left on). as you can see, this TL has a better “fit”, with several more candlestick body and wick tags. therefore, EGLE officially broke above this downtrend line on 9/11, after making an impulsive breakout above it earlier in the year (february) and then falling back below on may 10th. as far as the suggested stop, EGLE did very briefly spike a couple of cents below the breakpoint level of 3.48 but almost immediately came right back above that level. as such, i will leave this trade active for now. my preference is to only use standing stop-loss orders when away from the computer, as the frequency of stop-raids has increased tremendously in the last few years with the proliferation of HFT.
if you were stopped out, EGLE still looks good and still has plenty of room left before the first target. also keep a close eye on the other shipping stocks as once one of the group breaks out, the rest usually follow suit shortly thereafter (assuming they are setting up in bullish technical patterns). again, the risk for failed breakouts is elevated IMO but on the flip side, the momentum is strong. therefore, very active/nimble traders might do well with a hit & run trading style right now while it is probably best for less experienced or more conservative traders to avoid entering new positions right now or at least keep things light for now. for active traders playing breakouts or momentum trades right now, i would seriously consider taking at least partial profits on any quick long-side gains before the close today due to the overbought conditions of the market coupled with the fact that nearly all major world indices are trading at or near key resistance levels.
