Thursday 17 January 2013

Trade idea: Long on horse meat anyone?



While UK Supermarket giant, Tesco, yesterday squirmed amid shock revelations that its beef burgers were contaminated with horse meat (of all things!), it’s share price took a tumble, after gapping down. However, it later recovered to unveil a rather interesting price action set up.

As we trade what we see off the chart, regardless of how vulgar the prospect of horse meat is in your burger – the current technical set-up could very well be of interest to you...but only if you trade UK stocks.

In favour of a long of the break of yesterday’s high:
Bullish pin bar reversal
The previous swing high acting as support
Rejecting a previously tested 20ema (blue line)
Rejecting a trendline (3rd test)
Good momentum driving cyclicity; higher swing highs and higher lows
A Fibonacci cluster: 0.382 rejection and 0.618 over lapping





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