A reversal is a change in the direction that an asset's price is moving. Either an upward or downward reversal can happen. Following a significant price increase, a downward trend reversal could be expected. The opposite is true, that following a steep decline in price, a trend reversal could take place. Reversals usually don't depend on a single period or two bars on a chart; instead, they depend on the general price direction. Some indicators, like a moving average, oscillator, as well as support and resistance levels, such as trend lines, channels and other technical patterns, may be useful for identifying trends and reversals.
The market has been range bound for the last few weeks with volatility on the decline, and earnings all over the place. So where to go to look for a trade? Nike has already had Earnings and is near a low of the year, so seems like a good option. As a contrarian that can mean only one thing to me: I have to make a trade with the assumption it will go up from here over the next 45ish days. We will do that by making a Long Call Vertical trade to bet that it starts to head up over the next couple months. For more on my trading and how to join me in real time, see below. Watch the video to get the details. Kal Trading Risk Disclaimer All the information shared in this video is provided for educational purposes only. Any trades placed upon reliance of SharperTrades.com are taken at your own risk for your own account. Past performance is no guarantee. While there is great potential for reward trading stocks, commodities, options and forex, there is also substantial risk of loss. All tr