This is why it pays to follow technical levels. Even if you think it is an imaginary line.
Big gap down to support following AMD's earnings release.
- Apparently, investors didn't like the initial earnings release.
- The gap down abruptly stopped at a major Fibonacci support level.
Bullish investors tend to enter long positions at support.
- You can see a clearer picture of the Fib level below with daily candles.
- This Fib level acted as major support last Thursday as the price gapped up from this support line overnight into Friday's open.
- Short-term traders were likely watching this support price for a potential rebound.
A 5% rebound followed the rebound off of Fibonacci support.
- Swing traders made a nice quick dollar as AMD ripped off of Fib support with over a 5% move to the upside in a very short amount of time.
- This could be a false move to the upside based on the initial earnings reaction. But if you are a swing trader, then that doesn't matter. You can take your profit whenever you want. You can even go short at the breakdown of this Fib level.
This is why I always follow the technicals within the charts.
- Sometimes, the technicals just make swing trading easy.
As always, I am not a financial professional, and this is not investment advice. Be careful and be patient. Dont anticipate the market. Rather, participate in the market. Give some of your investments time and know when to cut your losses. Don't be greedy. Don't invest in anything you don't understand. Don't put all of your eggs in one basket. Don't listen to the hype. Don't fomo or panic into or out of trades. Do your own due diligence. And just follow the trends. A trend is your friend. Good luck trading.
Disclaimer: Community is offered by Moomoo Technologies Inc. and is for educational purposes only.
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Kube : thanks for the great analysis
Destrier : was it one position that caused the dip?
SpyderCallOP Kube: for sure no prob
SpyderCallOP Destrier: I doubt it, but let me check
MonkeyGee : 90% of the stocks looks like amd charts
SpyderCallOP Destrier: This is the only major fill that is worth mentioning. This big order happened just before earnings release, and it was well below the ask.This could have scared some investors perhaps. There was no other significant order that might have caused the upside.
SpyderCallOP MonkeyGee: daily candles or after hours?
MonkeyGee : Many stocks on weekly or monthly timeframe have the falling wedge formation
SpyderCallOP MonkeyGee: I see what you mean. A lot of equities have been in a correction/consolidation for a few months. and a lot look just like AMD.
MonkeyGee SpyderCallOP: Yeah, this is one of the longest corrections I have experienced. It started right after Biden took office. so I guess we will have another year of corrections to deal with.
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