TWTR Twitter – Potential Island Reversal Bottom Chart Pattern

by Olivier on August 27, 2014

Quick trading idea as TWTR – Twitter looks like it has put in a bullish ‘Island Reversal’ bottoming pattern that is part of a bigger bullish inverted head and shoulders reversal chart pattern. As you can see in the chart the huge volume spikes created equally impressive gaps. The technical term for the trading that took place between those two gaps is called an ‘Island’. When islands are clearly visible they often signal a meaningful reversal pattern. Although it is too early to tell, TWTR sure looks like wants to go higher now. If we get follow through it might emerge as one of the new big cap leading stocks.

Click on chart to enlarge:

If volume and price increase, this would validate the bullish pattern. The inverse head and shoulders pattern implies a conservative price target around 60$.

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