Repeat Bullish Pattern in Twitter TWTR Calls for New Highs

Mar 24, 2015: 10:14 AM CST

Twitter (TWTR) is back in the news with a bullish breakout and a strong recent rally.

There’s an important pattern in price, momentum, and volume aligning that suggest even higher price highs are more likely to come in the near-term future.

Let’s see the pattern and chart the levels in the relatively new stock Twitter (TWTR):

Before viewing the current action, let’s study the late July 2014 alignment and compare it to what’s happening now.

Twitter rallied up off an inflection/reversal low near $32.00 per share to break into a new daily chart uptrend.

Pay particular attention to the yellow highlight which reveals…

  • A GAP in price and new breakout high
  • A New Momentum (Oscillator) High
  • A Large Spike in Bullish/Buy Volume

Taken together, the alignment of a new breakout price high when confirmed with momentum and bullish volume all suggest that higher price highs are yet to come after a pullback (retracement).

Twitter indeed did retrace to the $44.00 per share level (rising 20 day EMA) and then the new price high – forecast from the triple alignment – occurred in September (green highlight).

A negative divergence and distribution volume in October signaled the end of the short-term bullish trend and price reversed to a downtrend.

We saw an end to the downtrend this time off the $36.00 per share level as yet another Bullish Gap was confirmed with a New Momentum High and a similar Bullish Spike in Volume.

Already, we see the new price swing high trigger with today’s bullish breakout event.

The suggestion – from the alignment and ‘repeat pattern’ – is that Twitter shares could trade higher in a similar outcome to what we saw in 2014.

If history repeats – or creates a similar echo – then look for Twitter shares to continue trading higher at least toward the $52.00 to $54.00 level and likely higher than that on a breakout to new all-time chart highs.

Plan your trades around retracement and breakout events that occur in real time under this bullish pathway.

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Corey Rosenbloom, CMT
Afraid to Trade.com

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1 Comment

One Response to “Repeat Bullish Pattern in Twitter TWTR Calls for New Highs”

  1. Roach Says:

    We need to be very careful when the trend is repeating as it might just suddenly move big against us, so I am always careful and to secure myself I use OctaFX broker’s great rebate option, it is very handy since I am able to earn 15 USD profit per lot size, it’s a very big cash back to get and I can make massive profits from this only and rest from trading makes it overall huge for me in this market!