the chart that I am looking at here is Apollo Group (APOL) and you can see that price has already broken out of a wedge formation. The reason I quite like the look of this setup is due to the solid candle that accompanied the breakout. As I have said previously, the finding of the pattern is one thing but judging the characteristics of the breakout is separate and of great importance. Not that a good breakout is any sort of guarantee but it certainly helps.
You can see here that the price broke out strongly and has since started to retrace toward the support/resistance line. This is OK because the pattern is not invalidated. The way that I am thinking of playing this setup is to set a stop entry above the high since the breakout (you may want to wait for a close above this level if you would like some extra comfort) and place my stop loss order at $52.75 which is just below the low of the breakout candle. I am looking for a profit target here of $59.20. Based on an entry price of $54.40 this represents a risk:reward of 1:2.9 which is adequate though not massive.
Send me your thoughts on this setup.