A Play for Whole Foods WFM Off Critical Support

Aug 22, 2016: 3:00 PM CST

Is it time to buy Whole Foods stock (WFM) for a rapid bounce swing trade?

Let’s see if that might indeed be the case:

Just based on a quick glance at the Daily Chart, we’re seeing a potential repeat-bounce higher.

The $30.00 per share level is an Aust support point and a June reversal point for price.

Thursday and Friday gave us bullish reversal candles off this level and Monday’s action gave us a strong bullish candle.

Just looking at $30.00 your first short-term bounce target is the Midpoint Magnet (yellow) at $32.50.

Should price repeat the bounce pattern for a third time (note May), then the final target would be $34.50.

This logic is based on nothing more than a support-bounce play.

Either way, $30.00 will be your critical “bullish above; bearish beneath” pivot.

The Weekly Chart gives us cause for more bullishness.  Here’s why:

Through 2014, WFM shares formed a Rounded Reversal on Positive Divergences ahead of a breakout above $40.00 – an aggressive yet very successful buy signal – in December.

Shares collapsed from $56.00 to $28.00 after that but we’re now seeing a longer/larger similar Reversal Pattern on Positive Divergences.

At the moment, the $30.00 per share level is the last line of defense for the bears – if they can’t push price under $30.00 then buyers/bulls are likely setting the stage for another big upswing higher.

Whether you’re a short-term trader or a longer term investor, watch the departure up away from (or down away from) $30.00 and the growing bullish evidence for a possible rally and bullish phase into 2017.

Afraid to Trade Premium Content and Membership

Follow along with members of the Afraid to Trade Premium Membership for real-time updates and additional trade planning.

Corey Rosenbloom, CMT

Afraid to Trade.com

Follow Corey on Twitter: http://twitter.com/afraidtotrade

Corey’s book The Complete Trading Course (Wiley Finance) is now available along with the newly released Profiting from the Life Cycle of a Stock Trend presentation (also from Wiley).

1 Comment

One Response to “A Play for Whole Foods WFM Off Critical Support”

  1. Antriksh Says:

    These levels are indeed critical and one got be very careful with working it out. I always love following this blog which is helpful in working. I also get superb support which is to do with OctaFX broker and their magnificent features and facilities which include zero balance protection, low stop out levels, instant payments, bonuses and even rebate scheme, it’s all picture perfect and really helps in working nicely for me with giving complete comfort in working for me.