So, today we suggested buying ARO at $2.68 with a $2.57 Stop...Why?
Well, although this one shot up right out of the gate due to a positive announcement, we want to see how it handles such a pop.
This is why we usually wait until around 10:30 to get involved.
I believe we had our confirmation on the 4th candle, the red down candle, as we really like failed sell off attempts.
It clearly doesn't happen all the time as this one could of easily retraced from such a high perch.
Note our Stop level is below the low of the 2nd candle..which we never even got close to.
This quick pullback ended as the next up candle confirmed our trade even more.
Then we had the 2nd breakout which in this case is a move out of the consolidation rectangle and into the next higher level..kind of like building on blocks.
Anyway, this is a favorable pattern which in combination with a very strong overall market(+300pts at this time) made for a good risk/reward opportunity.
And that's all you can ask for...
A favorable chart pattern, great volume, agreeable Indices and a close stop..
And lastly, we took our profits and ran as the day was winding down and our proprietary indicators showed a large selling band up around the highs at $2.88.
Tomorrow is another day and I'd look at the Pink trend-lines on this chart as support levels.
But as always, we'll wait to for tomorrow when in the trenches to make further decisions on ARO.