May 16 Chart of the Day - Charter Communications
Highly precise price action technical analysis offers the strongest trading edges and the most opportunities across the markets, making it the foundation of our reviews.
Charter Communications (CHTR) agreed to buy privately held competitor Cox Communications for $21.9B combining two of the largest cable and broadband operators in the US.
Often times an announcement like this can fundamentally depress the acquiring firm's share price however, in this case price seemingly broke out and could be reaching for the glory days of yester-year.
Is this a fake out or legitimate break out?
We'll examine the price action for clues.
Consistent profitable investing and/or trading requires a structured, rules-based approach to price action analysis. Proven processes, disciplined risk-reward management, and precise execution create the foundation for long-term success.
When combined with powerful mental performance strategies, this method becomes the ultimate blueprint for thriving in any market, on any time frame.
As requested, this analysis will take a price action technical analysis approach to assess key levels and potential next price moves for this chart.
Since May 2023, we've showcased over 500+ Charts of the Day and provide FREE Price Action Trading education to traders who join our highly rated Trade Room.
Monthly Chart
On the monthly chart price seemingly broke its series of lower highs and lower lows with its last major low bounce in the $250 area surging all the way back up over $420.
Currently, price is desperately attempting to set a higher high and continue its ascent back up.
This kind of movement highlights why a cautious and well-informed approach is essential when evaluating a stock’s short to mid term outlook.
Weekly Chart
On the weekly chart, we can see with much more clarity the volatile cycles up and down over the years.
Along the way price crossed a change control zone (long gray rectangle) roughly between $396 and $408 twenty times in the past 2.5 years and twenty-eight times in the past 8 years.
Change control zones are one of the five price action tools we teach when charting anything. By definition, they are an area that represents where neither the bulls nor bears are in charge. Price can slash through the zone with seemingly reckless abandon, price can respect the top or bottom from outside it or within it. Or, price can trade aimlessly sideways within it. When price breaks away from the zone it can often get drawn back to it like a magnet. And in this case we see all of the above are true.
Most recently price visited the $310 area but it wouldn't be surprising to see price visit the change control zone area yet again.
It goes without saying though, the only guarantee in the markets is that price cycles. It cycles up and it cycles down across all time frames and all charts and rarely, if ever, moves in a straight line.
Only time will tell for sure what price will do next...
We’ve combined Fibonacci levels with key support/resistance zones and trend analysis to pinpoint potential price levels of interest and future targets.
With precision-focused charts like these, both traders and investors can confidently build and execute their strategies.
So what's next?
We don't make predictions...
Nobody knows for sure but using these 5 price action tools traders and investors can develop levels of interest in both directions.
- Support/Resistance
- Trend
- Fibonacci
- Supply/Demand Zones
- Change Control Zones
ChartPros provides the exact methodology in its price action technical analysis courses to create charts like this with the most precise and accurate levels from which investors and traders can formulate their respective trade plans.
Take a look at the charts and let us know what you think. We'd like to hear from you in the comments sections.
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