Hi everyone- well this is a fun chart at the moment! Apologies for the long post but there's lots of good chart stuff happening at the moment.
Quick quiz: What's the difference between an Inverse Head and Shoulders and a Megaphone?
Answer: Half a cent.
Below is a weekly chart showing an Inverse Head and Shoulders (or H&S bottom) in red, and a Megaphone (or Broadening Wedge) with pink dashed lines. Using the measure rule from Bulkowlski's Pattern Site, in this case anyway, the price targets for each of these patterns differs by only half a cent! What's interesting and a little bit spooky to me is that this $1.575/$1.58 level is also right in the middle of a thick trading zone identified in orange. Price tends to bounce off the upper or lower edges of these zones, or will bounce around within the zone before continuing or reversing, so this sort of projection makes some sense with the methods I use to identify good support and resistance areas. Anyway, price hasn't yet broken above the Megaphone pattern, but is very close and apparently has a 74% success rate of hitting the targets. However the Inverse Head and Shoulders broke 4 days ago and apparently has a 71% success rate.
When you zoom in to the daily chart (also included below with some comments), it looks like price is ready for a bit of a pull back or sideways action. Price has closed 4 days in a row above the upper Bollinger Band. It's really unusual for any stock to go 3 days above or below the bands - not impossible just rare - for example the only time 5GN has gone more than 3 consecutive days closing above the bands is back in March 2018. I usually use the bands as a guide of when
not to buy (just bad risk vs reward) rather than a sell trigger, but I put a trailing stop on Tuesday which got hit at $1.11 Wednesday. Perhaps a bit of a hair trigger on the sells at the moment but should not complain.
Of course price could continue to rocket up for whatever reason, but looking below for a chance to jump back in there's an interesting area which of course is centered around the gap (shown in yellow on the daily). Don't ask me why gaps act as magnet for price but often they just do. What potentially gives this gap extra magnetic powers is that it aligns with several other TA methods, so there's more "eyes" on it from all sorts of market participants, which might make a re-test of this level a sort of self-fulfilling price point. My hunch (should it pull back a bit further) is that there will be a lot of traders (including me) jumping in at the top end of the gap which will leave it as an un-closed breakaway gap.
Like I said- lots of fun with this chart at the moment! Good luck everyone.
(20min delay)