Capitaland

Capitaland

Capitaland looks like a double top formation that has been confirmed having closed below 6.04 several times in the past week. Support is at 5 - 5.15 from the horizontal consolidation area seen nearby. Capitaland has also closed below the long upwards trendline.

However do note that 59% of Eve and Eve double tops have pullbacks.

Coupled with this being a really blue blue chip, I would place my bets that this might be a busted pattern.

Even more mouthwatering is that for busted double top patterns the average rise is a 74% gain in prices once it is confirmed.

How do we confirm a busted pattern? If the price of Capitaland goes higher than 8.75, that would confirm it. And a rise of 74% will have a price target of 15.22!

I will be monitoring a few price levels. First a break back above the upward trendline. Second a break above 7.56 which is the necktie crossover of the 25 and 50 day moving averages. And then a break above the downsloping trendling joining the two tops. And of course finally 8.75.

I'll be conservative at this juncture given the market situation. All eyes on the Dow for a true confirmation of its own double bottom formation first would be a start.

But this is a blue chip and I no longer short blue chips. (Check my trading rules *wink*)