My previous article for Palo Alto Networks (PANW) also had some charts for CyberArk Security (CYBR). These two cyber-security firms are what you would call the "Best of Breed" in my opinion.
But who am I? I am just some obscure technical analysis writer living in the suburbs of Chicago Illinois. My opinion won't change a market. Even known short seller Andrew Left is bullish on Palo Alto Networks (PANW).
Palo Alto Networks (PANW)
Let's start off with a longer-term chart for Palo Alto Networks (PANW) to help see the longer-term trend. I will use a 5 year monthly candlestick chart for this purpose.
The Japanese candlestick book states that the support area for a Hammer candlestick pattern is the bottom of the real body for the candlestick. By definition then, it would suggest selling shares on a break below the bottom of it. However that would have meant selling out near the low in May 2016 only to see PANW's share price rise again starting in July 2016.
This is one trading strategy of a few where I disagree with the candlestick books. After you look at the below chart, you will start to understand why.
On the Hammer candlestick pattern webpage I talk about a secondary support area for the candlestick pattern. That secondary support area was very important during PANW's consolidation over the next several months.
After I drew a few trendlines, placed a Fibonacci Extension Tool on the chart (to measure downside risk areas for PANW's share price) and where I also identified the secondary support area for the Hammer candlestick pattern, this is what the chart now looks like......
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Thanks for the analysis Bass. Mom approved works for me 🙂
I purchased shares for mom last week at the $146 level. about 10% of her portfolio.