I recorded a video analysis for Hewlett-Packard (HPQ), a stock being beaten down since the last 2 years. Most expect selling to continue but I believe the stock will have a few days/weeks to get a bit of a breather.
Hereunder is my video analysis for HPQ:
This stock has been trading in extension shorts on the weekly timeframe with the last setup short at 29.30 and 1st and 2nd targets respectively at 17.70 and 11.60. Some believe the stock will keep going lower from here but I think the stock is due for a relief rally. On the weekly chart the next level of resistance is at 16.30-40.
On the daily chart the closer resistance is located at 14.30, which leaves some room for a brief rally in this stock.
Hereunder I am providing a trading plan for this stock going forward.
I have identified two scenarios for HPQ. In the first scenario we go straight up trading in extensions on the daily chart. The first resistance comes at the 20-day SMA with price that keeps moving higher into the 14.40 area of first resistance. After a shallow correction price would continue into the higher level of resistance and final target of long positions at 16.40.
In the second scenario we simply get a deeper correction after price hits the first resistance at 14.40. The correction would stop in the 12.90-13 area, the half way back from lows, to then continue higher into the 16.40 weekly resistance.
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