Just this Monday we analyzed the value of Talgo and warned of the possibility that the price series was trying to shape a ‘head and shoulders‘invested with significant upside implications for prices.
SHOULDER HEAD INVERTED SHOULDER
The confirmation of the figure back is there. The value closed above the resistance of 4.75 euros (maximum of January and clavicular of the formation), now important support. Which means that it is possible that the price will try to correct up to there in a typical ‘throw back’ movement. If it does, in theory, we will be faced with a new purchase opportunity. In the shorter term we have another important resistance in the weekly bearish gap of five euros (mid-March 2020). If this gap closes above this Friday, it will be canceled, which is without a doubt another new sign of strength.
In any case, if we believe the figure back, which is from a book, we can expect rises towards the area of the 7.50-7.80 euros in medium-term terms, facing the coming months and with their logical corrections against trend, of course. In the markets there are no infallible tools always keep it clear … but the figure and the upward implications of it are there.
Talgo weekly chart