Good morning everyone,
recently we looked at a potential head and shoulders setup on Atlas Iron which I wanted to send you an update on. The first thing that I wanted to look at was the profit target based on the measuring rule. This set us an initial profit target of about $3.28 which the price has now moved through. Different traders deal with profit targets in different ways with some viewing it as a fixed line in the sand while other view it as a time to tighten stops up whilst other still may reduce their position to take some skin out of the game.
The really interesting thing here is that the price retraced and found the 38.3% Fibonacci line as a support level. This in itself doesn't necessarily make it a major support but it is a rest point by the looks of it. We would typically look here at the potential for a Gartley style setup but based on the weekly stochastic it may be prudent to wait and see how it unfolds as it has just moved out of overbought territory.
It would be great to know how you handle dual timeframe setups like I have mentioned as well as how you like to scale in and out of positions or if you choose not to. Just drop a line in the comments section.
All the best,