CHTR, to long or to short.
Charter Communications (CHTR) reported earnings recently, and the stock closed up +16.62%. Despite the significant price increase, the earnings report itself did not justify such a dramatic rise. Instead, the movement can be attributed to the stock testing liquidity levels.
Understanding the Price Movement:
Liquidity Testing: Markets often move from one area of liquidity to another. Pre-market buyers anticipated this move once the stock surpassed the recent pivot at $340. The next significant liquidity level was around $374.42, approximately $375.
Intraday Reversal: Upon reaching this level, the stock reversed intraday and closed just below $370. This indicates that liquidity at this level was tested, and sellers stepped in.
Technical Analysis and Trade Plan:
Short Bias: The trade is short-biased if the stock closes below the $375 level with a bearish daily candle. This would indicate a rejection at the liquidity level and hold the character of a potential reversal.
Long Bias: For a long position, confirmation is needed with the stock closing above $373 on Monday with 1.5 times the relative volume (Rvol). This would suggest sustained buying interest and a potential continuation of the uptrend.
Volume and ATR Analysis:
Daily Candle: The daily candle on the earnings report day was above the Average True Range (ATR), indicating significant price movement.
Rvol: The Rvol was 2.94, showing a healthy volume that is expected for such an earnings gap.
Key Levels to Watch:
Above $375: If the stock can sustain above $375, the next target level would be $420, indicating a significant upside potential.
Below $375: If the stock closes below $375, the downside targets could be back to $340 - $320, suggesting a return to prior levels of support.
Charter Communications (CHTR) experienced a substantial price increase post-earnings, primarily driven by liquidity testing rather than the earnings report itself. Traders should watch for confirmation of direction by observing how the stock behaves around the $375 level with corresponding volume indicators. This will provide a clearer picture for either short or long trade setups.
Understanding the Price Movement:
Liquidity Testing: Markets often move from one area of liquidity to another. Pre-market buyers anticipated this move once the stock surpassed the recent pivot at $340. The next significant liquidity level was around $374.42, approximately $375.
Intraday Reversal: Upon reaching this level, the stock reversed intraday and closed just below $370. This indicates that liquidity at this level was tested, and sellers stepped in.
Technical Analysis and Trade Plan:
Short Bias: The trade is short-biased if the stock closes below the $375 level with a bearish daily candle. This would indicate a rejection at the liquidity level and hold the character of a potential reversal.
Long Bias: For a long position, confirmation is needed with the stock closing above $373 on Monday with 1.5 times the relative volume (Rvol). This would suggest sustained buying interest and a potential continuation of the uptrend.
Volume and ATR Analysis:
Daily Candle: The daily candle on the earnings report day was above the Average True Range (ATR), indicating significant price movement.
Rvol: The Rvol was 2.94, showing a healthy volume that is expected for such an earnings gap.
Key Levels to Watch:
Above $375: If the stock can sustain above $375, the next target level would be $420, indicating a significant upside potential.
Below $375: If the stock closes below $375, the downside targets could be back to $340 - $320, suggesting a return to prior levels of support.
Charter Communications (CHTR) experienced a substantial price increase post-earnings, primarily driven by liquidity testing rather than the earnings report itself. Traders should watch for confirmation of direction by observing how the stock behaves around the $375 level with corresponding volume indicators. This will provide a clearer picture for either short or long trade setups.
Feragatname
Bilgiler ve yayınlar, TradingView tarafından sağlanan veya onaylanan finansal, yatırım, işlem veya diğer türden tavsiye veya tavsiyeler anlamına gelmez ve teşkil etmez. Kullanım Şartları'nda daha fazlasını okuyun.