"Cup & Handle Pattern Anyone?" How MPT +29% in UVXY Call
by Mike Paulenoff
September 4, 2020 • 12:00 AM EDT
This past Monday (Aug 31), Mike Paulenoff started alerting MPTrader members about opportunities UVXY, then trading at 21.53.
He wrote: "UVXY continues to act like the canary in the coal mine because it is holding up so well despite ES, SPX, SPY climbing to new all time highs. UVXY remains 12% above its 8/26 low at 18.76 and, more conspicuously, 50% above its 2/20/20 low at 10.65!"
Mike added, "UVXY needs to climb and sustain above 23.00 to start to gain serious bullish traction that will point to a test of critical resistance between 23.70 and 24.60."
Mike went on to post eight intraday follow-up charts throughout this past week, updating members about the progress and counter-trend upside potential developing in UVXY.
This culminated at 10 AM Thursday morning with his observation,"Cup-and-Handle pattern anyone? Key 'Handle support' resides at 22.25 to 23.00, which should contain the pullback from this AM's pre-open new recover rally high at 24.67... ahead of a new upleg to 25.90-2640, in route to 28-31."
By Thursday afternoon, UVXY rocketed out of its month-long base formation to a post-market high of 30.35, satisfying Mike's anticipated upside target, amounting to a gain of 29% from Mike's original post on Monday.
Where is UVXY headed next?
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Mike Paulenoff is the author of MPTrader.com, a real-time diary of his technical analysis & trade alerts on
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More Top Calls From Mike
In our Top Call article a month ago, we told you about how Mike Paulenoff called AAPL's upside continuation, with the expectation that the stock could extend a little higher before upside exhaustion.
AAPL, indeed, went on to stair-step higher to reach a high of 157.26 high last week, overshooting the upper boundary of Mike's 153-156 projected high-zone by just 0.8%. It then proceeded to initiate the expected bout of weakness that accelerated to the downside this past Friday.
On August 11, Mike Paulenoff alerted MPTrader members to a significant upside reversal signal in AMZN.
Mike wrote that "the 500 point decline is nearing downside exhaustion," noting a preferred downside target zone of 3180-3200.
Fast-forward to August 20, when AMZN pressed to a new multi-month corrective low at 3175.76.
On August 3, Mike Paulenoff alerted MPTrader members to the developing setup in AAPL that also would eventually impact the broader market:
Mike wrote: "AAPL continues to levitate within a high level digestion period and pattern off of its ATH at 150 hit on 7/15. All of the action since mid-July certainly resembles a Triangle pattern atop the May-July upleg from 121.68 to 150.
Probably the first price pattern both fundamental and technical investors learn to recognize is a Head and Shoulders Top. Rightly or wrongly, it is the Holy Grail of technical formations, striking fear into holders of the stock, index, ETF, or commodity that exhibits such a technical set up, while eliciting an opposite reaction from put owners and short sellers who anticipate huge gains captured by impending weakness.
Last Wednesday (July 14), with AAPL trading at 148.65 but off of its new all-time high at 150, Mike Paulenoff alerted MPTrader members to potentially consequential yellow caution flags emerging in his technical setup work.
Mike wrote:
This morning, JPM raised its Target Price to 175, one day after Citigroup raised its Target Price to 170. Do I hear 180... 185? Crickets at the moment. The Street is falling all over itself in its bullish view of AAPL.