A shooting star is a bearish candlestick that has a small body, a long upper shadow, and little or no lower shadow. The shooting star is basically an inverted hammer (or a gravestone doji) that appears at the top of an uptrend. The formation of this pattern is the result of zealous buying. Prior to the shooting star formation, price is basically in a momentum run pushed upward by bullish energy. On the day of the shooting star formation, price rises significantly higher, fueled by exuberant buying and reaching overbought conditions. At that point price starts to pullback and closes the day near or below the opening price. Generally that marks the end of the uptrend and the beginning of a correction or downtrend.
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