Bovis Homes Group is Pulling Back!
In my previous post for Bovis Homes Group which you can find here, price had formed an inverted pattern. Price then continued to move in the direction of the uptrend but as is expected, price is now forming a pullback.
When price breaks through an area of strong resistance, most of the time price will pull back to retest the previous resistance which turns to support. Price is doing just that and this is why we always wait for the second breakout as price can sometimes drop back below the and go into consolidation.
Right now it appears that price is using the to potentially give it momentum to bounce back but a breakout will confirm this.
There is never a need to jump into a trade early even if you can potentially get in at a cheaper price. When you wait for breakouts, you confirm the trend direction and end up getting into more profitable trades because the odds become in your favour, which is what you want as a trader.
The pullback is small so if we do get a breakout it may happen soon so continue to keep this stock on your watchlist.
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