NEO is at a very precarious price level. At current prices, it is trading at August’s highs and this is the same level which was broken by December 17 candlestick. Like I had said before, that candlestick was a typical break out and as per break out guidelines, a retest of break out level was expected.
But, look at how last week’s candlestick closed? It is above the upper BB and means there is a correction that might happen towards equilibrium at the middle BB.
So for trend to be fully defined, this week’s candlestick close characteristic is important because we are basically at a dilemma with potential entry fading each other. Go long and trade the break out according to the weekly chart general trend or short NEO because it is over-valued.
Personally, I want to trade the break out in the mean-time and assume chances of a correction is low as it is a miniscule happening in a general bullish run.
Price is right at the support but will the middle BB hold? If it doesn’t will NEO price action then bounce off the support trend line? If both conditions are rendered useless then support at $45 will be targeted by bears.
Otherwise, as I mentioned before, I’m net long and will only be aiming to trade December 17 bull break out, if today ends up as a bull then its good news because other than the bear pressure experience from December 22, I can see a little bit of higher highs relative to the middle BB with long lower wicks especially after yesterday’s close.
In our entry chart-following the break out, the 20 period MA has been our resistance line as it was successful in muzzling out buy pressure after December 22 lower lows.
I’m trading the break out and we have this buy signal turning from the oversold territory and already the middle BB has been breached to the upside.
As a buyer, I will aim for December 19 highs of around $85. One thing guys, notice that prices reversed from the 61.8% retracement level even after last week closed as a bear? I have some confidence that $85 might be hit but as always nothing is guaranteed.