Cal ’23 German Power has hit a high of 189 for the second time in a month.
Does this mean we have a “Double Top”? Our weekly report today discussed this common mistake in Technical Analysis. THIS IS NOT A DOUBLE TOP!
Here’s what we said:
•Short term Trend: Positive
•Medium term Trend: Positive
•Summary of recent price action: This went up last week, back up to 189, the high from March 8th. We got there on Friday morning, then found some sellers.
•Thoughts: So we have two highs at the same level. Amateur/Bad Technical Analysis/Analysts will be calling this a “Double Top” It isn’t. It is two highs at the same price, yes, but a “Double Top” reversal pattern is only formed if/when the low between the two similar highs is breached, and in this case that means we don’t get a sell signal until/unless 154 is broken. That’s a long way off, and before we get there we have strong (gap) support levels at 171.50 and 163.50 to see off, as well as our rising uptrend line which is at 169.70 today and rises to 173.30 by Friday.