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  • Chart Pattern Alert: Avery Dennison Corp 0 comments
    Aug 7, 2014 9:48 AM | about stocks: AVY

    Over the past few months, Avery Dennison Corp (NYSE:AVY) has formed a well known bearish pattern on the charts called, "Head and Shoulders Top." Take note of the chart below and continue reading...

    (click to enlarge)

    While this is a great chart pattern for trading; knowing how to read it properly is most important. Many amateur traders may enter the trade now, not considering the fact that it has not triggered as of today's close. By entering the trade before it triggers, you are running the high risk of the pattern failing. One thing we must do as traders is keep our risk low and the odds in our favor, that is how you profit consistently over time. So, in order for the pattern to trigger, the daily chart must close below the grey line, which now stands at a price of $46.97.

    Should this pattern trigger as mentioned above, Avery Dennison Corp (NYSE:AVY) could sell off quickly. However, AVY will likely have bounces as it moves down towards the ultimate H&S Top target of $41.08, which is to be expected. The first key level to break after triggering this bearish set up will be $46.16 followed by a major support level at $44.05.

    There is a lot of potential downside for Avery Dennison Corp (NYSE:AVY) in the cards, which makes it a good risk/reward trade since your stop loss will be any daily close above the neckline, noted in the chart above by the grey line. Please note, without other technical factors such as, a time count or confirmation supporting the odds of this pattern, the potential of it failing increases. Another consideration is that many amateur traders may think they have located this same pattern, however, they all too often fail in trading it properly.

    Kiliam Lopez

    Stocks: AVY
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