As of 12/02/2024
  Indus: 44,782 -128.65 -0.3%  
  Trans: 17,545 -73.73 -0.4%  
  Utils: 1,057 -21.90 -2.0%  
  Nasdaq: 19,404 +185.78 +1.0%  
  S&P 500: 6,047 +14.77 +0.2%  
YTD
 +18.8%  
 +10.4%  
 +19.9%  
 +29.3%  
 +26.8%  
  Targets    Overview: 12/02/2024  
  Down arrow44,000 or 46,000 by 12/15/2024
  Down arrow17,025 or 18,000 by 12/15/2024
  Down arrow1,025 or 1,100 by 12/15/2024
  Up arrow20,000 or 18,500 by 12/15/2024
  Up arrow6,200 or 5,900 by 12/15/2024
As of 12/02/2024
  Indus: 44,782 -128.65 -0.3%  
  Trans: 17,545 -73.73 -0.4%  
  Utils: 1,057 -21.90 -2.0%  
  Nasdaq: 19,404 +185.78 +1.0%  
  S&P 500: 6,047 +14.77 +0.2%  
YTD
 +18.8%  
 +10.4%  
 +19.9%  
 +29.3%  
 +26.8%  
  Targets    Overview: 12/02/2024  
  Down arrow44,000 or 46,000 by 12/15/2024
  Down arrow17,025 or 18,000 by 12/15/2024
  Down arrow1,025 or 1,100 by 12/15/2024
  Up arrow20,000 or 18,500 by 12/15/2024
  Up arrow6,200 or 5,900 by 12/15/2024

Bulkowski's Vertex Pharmaceutical Trading Quiz

Released 12/11/2020.

VRTX: Quiz

Below is a slider quiz to test your trading ability. Captions appear below the pictures for guidance, so be sure to scroll down far enough to read them.

 

1 / 7
chart pattern

What chart patterns can you find? Look for the following: Dead-cat bounce, broadening top, diamond bottom, descending triangle, triple bottom (unconfirmed), double bottom.

Answers are on the next slide.
2 / 7
chart pattern

Price has broken out upward from the large descending triangle.

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?

My answers appear on the next slide.
3 / 7
chart pattern

Answer 1: Buy because of the upward breakout of the descending triangle. Answer 2, 3: See the next page.

This is the weekly chart. I show the rounding turn in the blue line and overhead resistance in red.

Here's my notebook entry for the trade. "Date: 10/7/04, filled at: 11.25. Stop: 9.57, below the lower broadening top boundary. That's a large decline of 15%. Upside target: I see price stalling at 12.25 but pushing through. This could be at the bottom of a very long rounding turn, with top at 96. See monthly/weekly scale. 16.50 looks like a good upside target. That is the site of an old high in June, August and in prior years (fall '99). Future S&P direction (guess): down as it's at top of descending broadening wedge. It could breakout upward, though. Buy reason: triple bottom, pipe bottom, and broadening top all signal a buy. It's been a year since the dead-cat bounce and with this flat base, the stock could move up. The bad news is that I am late getting in...again."

The following slide shows the next part of the trade.
4 / 7
chart pattern

This is a screen shot of the stock on the daily scale and the S&P 500 on the lower half. Notice how the index was climbing, forming a large descending broadening wedge or maybe a channel. I predicted the index would drop. If so, why was I buying?

More on the next slide.
5 / 7
chart pattern

This shows that I placed the stop below September's minor low but I placed the stop on the day I bought. As I mentioned in my notebook, the stop is 15% away from the buy price but as you can see, it worked well because anything much closer and I would have been stopped out. That's the price you pay when you trade stocks below $15 or so (very volatile).

Question. On the last day shown, I did something important. What was it?

My answer appears on the next slide.
6 / 7
chart pattern

Answer: "12/16/04: Stop raised to 10.23."

This chart shows the day and price that I placed the stop. You can also see that price hit the stop. Here's my notebook entry for the sale.

Date: 1/3/2005, filled at: 10.232. Sell reason: Hit stop."

How timely was the sale?

The next page shows the result.
7 / 7
chart pattern

I show this on the weekly scale. After I sold, price moved up to A at a price of 11.99 and then tumbled to a low of 8.61 at B. After that, price recovered, making a straight-line run upward.

The end.

See Also

 
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