eBay is to release its earnings number on Wednesday after market close. By analyzing EBAY's daily chart, we can see the price action has made a consolidation move within a small symmetrical triangle since June 20. This may be an interesting move for this stocks, but as with symmetrical triangle patterns, price may break in either direction.
However, through Ichimoku cloud analysis, this particular stock may well be on the bullish bias. On the daily chart, both the Chikou line and the cloud shows bullishness and the price currently being supported by the Tenkan/Kijun line and respecting the symmetrical triangle line.
Looking further back to Feb. 12, the price created a rectangle channel (shaded area) between the 35.40 and 39.40 area up to mid June before breaching the channel line on June 18. This channel line has also created a support price line after the price bounce from the peak of 40.55 on June 20. It then started to make both lower high and higher low.
Momentum and oscillator tools all give a normal reading without any sign of divergence with ADX still showing a good momentum.
If the analysis validates a bullish bias as per above, we can put a buy stop above the the previous high of 40.55 to be conservative or if we wish to be an aggressive trader, place a buy stop just above the upper line of the symmetrical triangle. Stop loss can be set just below the low of June 25 at 38.90 and a minimum target shall be at least equal to the risk of the trade.
