{"id":12236,"date":"2022-04-20T07:44:06","date_gmt":"2022-04-20T11:44:06","guid":{"rendered":"https:\/\/morpheustrading.com\/blog\/?p=12236"},"modified":"2022-04-20T07:50:10","modified_gmt":"2022-04-20T11:50:10","slug":"compx-inverse-head-shoulders","status":"publish","type":"post","link":"https:\/\/morpheustrading.com\/blog\/compx-inverse-head-shoulders\/","title":{"rendered":"The Bullish Nasdaq Chart Pattern that May Soon Lead Stocks Higher"},"content":{"rendered":"\n
\"Nasdaq<\/figure>\n\n\n\n

Recent price action in the Nasdaq Composite has been choppy and indecisive, but the tech-heavy index is stealthily forming a bullish chart pattern that could spark a new rally. <\/h2>\n\n\n\n

Volatile, indecisive trading in the Nasdaq Composite ($COMPX) last week led to big moves in both directions.<\/p>\n\n\n\n

On a short-term basis<\/em>, Nasdaq price action has indeed been a roller coaster ride.<\/p>\n\n\n\n

However, zooming out to the “big picture,” we see the Nasdaq Composite is actually in the process of completing an inverse head and shoulders<\/a> bottoming pattern.<\/p>\n\n\n\n

If completed, this powerful chart pattern would be a bullish signal suggesting the intermediate-term trend has shifted in favor of the bulls.<\/strong><\/p>\n\n\n\n

The inverse head and shoulders pattern is labeled on the daily chart of $COMPX below:<\/p>\n\n\n\n

\"Nasdaq<\/a>
Press chart to view full-size<\/em><\/figcaption><\/figure>\n\n\n\n

The current pullback in the Nasdaq Composite found support at the 13,300 area before jumping 2.2% in yesterday’s (April 19) session.<\/p>\n\n\n\n

On the chart above, notice how that support level is the same area where the low of the left shoulder also found support.<\/p>\n\n\n\n

Though not shown on the chart, the low of the right shoulder (13,300 area) also<\/em> converges with support of the 61.8% Fibonacci retracement<\/a> level from the last wave up.<\/p>\n\n\n\n

The April 19 rally sets up $COMPX for upside follow-through that may propel the Nasdaq to test its neckline, just above the 14,500 level.<\/p>\n\n\n\n

If the price breaks out above the neckline, then we could see follow-through that leads to a completion of the inverse head and shoulders pattern.<\/p>\n\n\n\n

Where will the inverse head and shoulders pattern lead?<\/h3>\n\n\n\n

The upside price target for any inverse head and shoulder pattern is equal to the distance from the neckline down to the head.<\/p>\n\n\n\n

In this case, that works out to an upward move of roughly 16.5% above the neckline–an ultimate price target around the 16,900 area.<\/strong><\/p>\n\n\n\n

Of course, there’s still a lot of work to be done before the Nasdaq Composite needs to worry about any upward price targets.<\/p>\n\n\n\n

Specifically, $COMPX must first overcome key resistance of its 10, 20, and 50-day moving averages to recover back to the neckline around 14,500.<\/p>\n\n\n\n

Further, a sudden break below the April 18 low of 13,222 would quickly invalidate this bullish chart pattern and return the balance of power back to the bears.<\/p>\n\n\n\n

As always, we remain focused on providing subscribers of our flagship swing trading service<\/a> with the best stock picks to profit in both up and<\/em> down markets–since 2002!<\/em><\/p>\n\n\n\n

GET STARTED NOW<\/strong><\/a> to start receiving your swing trade alerts of the most explosive stocks to buy now.<\/p>\n","protected":false},"excerpt":{"rendered":"

Recent price action in the Nasdaq Composite has been choppy and indecisive, but the tech-heavy index is stealthily forming a bullish chart pattern that could spark a new rally. <\/p>\n","protected":false},"author":1,"featured_media":12242,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":"","_links_to":"","_links_to_target":""},"categories":[5],"tags":[],"class_list":["post-12236","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-stock-picks-analysis"],"_links":{"self":[{"href":"https:\/\/morpheustrading.com\/blog\/wp-json\/wp\/v2\/posts\/12236","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/morpheustrading.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/morpheustrading.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/morpheustrading.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/morpheustrading.com\/blog\/wp-json\/wp\/v2\/comments?post=12236"}],"version-history":[{"count":10,"href":"https:\/\/morpheustrading.com\/blog\/wp-json\/wp\/v2\/posts\/12236\/revisions"}],"predecessor-version":[{"id":12266,"href":"https:\/\/morpheustrading.com\/blog\/wp-json\/wp\/v2\/posts\/12236\/revisions\/12266"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/morpheustrading.com\/blog\/wp-json\/wp\/v2\/media\/12242"}],"wp:attachment":[{"href":"https:\/\/morpheustrading.com\/blog\/wp-json\/wp\/v2\/media?parent=12236"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/morpheustrading.com\/blog\/wp-json\/wp\/v2\/categories?post=12236"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/morpheustrading.com\/blog\/wp-json\/wp\/v2\/tags?post=12236"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}