PCLN Update

Yesterday I posted this update for PCLN

If you have questions about what is going on today with PCLN, yesterday's post should answer most of them as PCLN broke some important support, the volatility shakeout was expected to be in play today along with some short term 3C charts indicating that was the likely path today. The Tech rotation is probably also helping PCLN a bit, but yesterday's update is a good starting point for understanding the short and longer term picture in PCLN.

 This is yesterday's break of support and why I suspected a bounce move. Note the volume recently in PCLN, it looks like the hedgies have been trying to squeeze out the door all at once, the bounce is something I'm sure they'll appreciate and be selling in to ad this entire area looks like a head fake area.

 We have resistance coming up in the area in the red box, I would suspect PCLN will try to move somewhere in the white box area.

 Here's the positive 5 min divergence from yesterday and thus far it's pretty healthy looking today.

 The 1 min chart shows a little negative divergence, most likely associated with a consolidation below the resistance area PCLN is at right now. I would suspect we will see a stronger negative divergence after PCLN moves through resistance. Remember they need strength to sell in to, if they start selling in to resistance now, they likely kill the move.

 The 1 day Trend Channel has held the move since PCLN started to get very volatile.

Yesterday technically would be considered the break of the uptrend as PCLN crossed below the Trend Channel, however that is a longer term view, think of it like this, an animal is most dangerous when it is wounded, so volatility in this area should be expected. The Trend Channel is starting to turn down, this is not good for PCLN's longer term outlook as it is the first time this year. The Trend Channel has a stop on a daily close at the $750 area, although with increasing volatility a wider channel may be more appropriate. PCLN ultimately will be at the mercy of the market and Tech, so once the bounce starts to fail, PCLN will have a lot harder time making additional gains and will likely set up a very nice short position.

The 2 day Trend Channel's stop on the upside is at the $755 area.

We'll keep an eye on PCLN, again for the longer term view, see yesterday's update linked above.