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Friday, January 13, 2006

BEBE - 011306

Can a chart be more simple?

1.) What did I see?
A gap up and wide-range, strong first bar. The second bar is indecisive with a long upper and lower tail/wick. The third bar is narrow range (NR3), an inside bar, and a nice hammer.
2.) What is the entry?
A break of the third bar high.
3.) What is the exit?
The target was the Fibonacci extension of the previous day's low to the opening range (OR) high. It was hit just before Noon.

Check back over the weekend for more charts.

Notes - as with any entry below/above a previous high/low (in the case of my charts, the opening range (OR) high/low), you need to watch for resistance/support as price approaches those levels. If it stalls, you want to exit. If it breaks through, the odds are good you will have a move to the corresponding Fibonacci extension. BEBE made a solid break of the OR high with the fourth bar.

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