As of 09/26/2022
  Indus: 29,261 -329.60 -1.1%  
  Trans: 11,999 -129.90 -1.1%  
  Utils: 953 -25.04 -2.6%  
  Nasdaq: 10,803 -65.01 -0.6%  
  S&P 500: 3,655 -38.19 -1.0%  
YTD
-19.5%  
-27.2%  
-2.8%  
-30.9%  
-23.3%  
  Targets    Overview: 09/15/2022  
  Up arrow32,000 or 29,200 by 10/15/2022
  Up arrow13,800 or 11,800 by 10/15/2022
  Up arrow1,000 or 950 by 10/15/2022
  Up arrow11,975 or 10,700 by 10/15/2022
  Up arrow3,800 or 3,500 by 10/15/2022
CPI (updated daily): Arrows on 9/13/22
As of 09/26/2022
  Indus: 29,261 -329.60 -1.1%  
  Trans: 11,999 -129.90 -1.1%  
  Utils: 953 -25.04 -2.6%  
  Nasdaq: 10,803 -65.01 -0.6%  
  S&P 500: 3,655 -38.19 -1.0%  
YTD
-19.5%  
-27.2%  
-2.8%  
-30.9%  
-23.3%  
  Targets    Overview: 09/15/2022  
  Up arrow32,000 or 29,200 by 10/15/2022
  Up arrow13,800 or 11,800 by 10/15/2022
  Up arrow1,000 or 950 by 10/15/2022
  Up arrow11,975 or 10,700 by 10/15/2022
  Up arrow3,800 or 3,500 by 10/15/2022
CPI (updated daily): Arrows on 9/13/22

Bulkowski's Campbell Soup Trading Quiz

Released 7/23/2021.

CPB: 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 / 4
chart pattern

What chart patterns can you find? Look for the following: Symmetrical triangle, ascending triangle, diamond top, descending broadening wedge, broadening bottom, triple bottom.

Answers are on the next slide.
2 / 4
chart pattern

My computer drew the blue lines so they are not as accurate as hand drawn ones. Forgive the appearance. The ascending triangle has price closing above the top trendline.

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 the stock because of the upward breakout.

Answer 2 (target?): Set the price target to near the top of the broadening bottom (28.13) or the diamond top at 28.70 (both are not shown on this chart. See the prior chart). Since two tops appear near 28 (Sept 2004 and April 2005), price may stall there. You can also use the measure rule for ascending triangles. Compute the height from the top trendline to the lowest low in the pattern and add the result to the top trendline. That would give a target of 28.77, very close to the highest peak on the prior chart (the diamond top).

Answer 3 (stop?): A good stop point would be just below the knot of support at 26.70, shown as a circle. That may be a bit close since it allows a decline of just 1.7% before hitting the stop. Volatility is 61 cents, meaning that a stop should be placed no closer than 26.56. Since this means lowering the stop from 26.70, I would use a Fibonacci retrace of the swing from the third bottom of the triple bottom to the high at the current price and place it at 25.73, which is just below the 62% retrace of that up-swing.

The above chart shows that price climbed after the breakout from the ascending triangle, but not before touching the bottom (26.68, A) of the knot I mentioned as a support level. Price recovered and peaked near 31, twice, forming what appears to be an unconfirmed double top (EE).

Question: Do you sell, hold on, or buy more?

My answer appears on the next slide.
4 / 4
chart pattern

The correct answer was to hold onto the stock because it continued moving up. In 65% of the cases I looked at in a bull market, price continued rising without confirming the double top as a valid chart pattern. In other words, price did not close below the lowest valley between the two peaks 65% of the time before making a new high like that shown in the chart.

The End.

See Also

 
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