As of 07/11/2024
  Indus: 39,754 +32.39 +0.1%  
  Trans: 15,430 +330.93 +2.2%  
  Utils: 939 +20.22 +2.2%  
  Nasdaq: 18,283 -364.04 -2.0%  
  S&P 500: 5,585 -49.37 -0.9%  
YTD
 +5.5%  
-2.9%  
 +6.5%  
 +21.8%  
 +17.1%  
  Targets    Overview: 06/28/2024  
  Up arrow40,000 or 38,000 by 07/15/2024
  Up arrow15,950 or 14,750 by 07/15/2024
  Up arrow960 or 890 by 07/15/2024
  Up arrow19,200 or 17,800 by 08/01/2024
  Up arrow5,750 or 5,500 by 08/01/2024
As of 07/11/2024
  Indus: 39,754 +32.39 +0.1%  
  Trans: 15,430 +330.93 +2.2%  
  Utils: 939 +20.22 +2.2%  
  Nasdaq: 18,283 -364.04 -2.0%  
  S&P 500: 5,585 -49.37 -0.9%  
YTD
 +5.5%  
-2.9%  
 +6.5%  
 +21.8%  
 +17.1%  
  Targets    Overview: 06/28/2024  
  Up arrow40,000 or 38,000 by 07/15/2024
  Up arrow15,950 or 14,750 by 07/15/2024
  Up arrow960 or 890 by 07/15/2024
  Up arrow19,200 or 17,800 by 08/01/2024
  Up arrow5,750 or 5,500 by 08/01/2024

Bulkowski's United Parcel Service 2 (UPS) Quiz

Released 8/10/2022.

UPS: Quiz

Captions appear below the pictures for guidance, so be sure to scroll down far enough to read them.


1 / 4
chart pattern

Look for the following chart patterns (If you find others, great!): Big W, broadening top, pennant, ascending broadening wedge, and a descending broadening wedge.

The answers are on the next slide.
2 / 4
chart pattern

The stock has broken out upward from the descending broadening wedge.

Question 1: Do you buy, short, or avoid trading this stock?

Question 2: If trading this one, what is the target price?

Question 3: If trading this one, what is the stop price?

The answers appear on the next slide.
3 / 4
chart pattern

Answer 1 (buy?): Buy because the breakout is upward. In fact, since price enters this chart pattern moving upward and the breakout is upward, the chart pattern tends to perform better (it acts as a continuation of the price trend, not as a reversal).

Answer 2 (target?): The top of the chart pattern is the price target. That’s 75.29.

Answer 3 (stop?): Since price has moved up in a straight-line run (B to A), I would use a stop based on a Fibonacci retrace of 62%. Subtract B (69.15) from A (73.74) giving a value of 4.59. Take 62% of this, 2.85 and subtract it from A. The stop should be placed at 70.89.

A check on volatility shows that it’s $1.27, and with a low at 72.71, that would place a stop at 71.44, so the 70.89 stop is comfortably below this, out of range of normal price fluctuations. If you don’t understand a volatility stop, visit my website at the link.

The above chart shows that price moved up until peaking in December and moving down marginally.

Question: Should you hold on for additional gains?

The next slide shows the answer.
4 / 4
chart pattern

Selling was the wise course. Sometimes, a bearish chart pattern does not appear at the top of a price reversal, so you have to use other indicators to signal a sale. In this example, a spike or tail appears. It’s a tall one-day price move in which the price closes near the intraday low. It usually signals a short-term decline but price often recovers quickly. Another sell signal occurred when price closed below the up, “sell” trendline. Holding on much longer than that resulted in disaster.

The End.

See Also

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