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Diageo shares (LSE:DGE) are expected to rally, following the current rejection at the support level of 1750, which is already a formidable floor (barring further bearish effort).
The adamant floor was tested in May and June 2015, but further bearish attempts were foiled. This same support level has been tested recently and we can see that further bearish attempt is being rejected again. While the RSI period 14 is below the level 50 and the price is still between the Trendlines, a bullish movement would be pinpointed once the price goes above the upper Trendline and the RSI period 14 goes above the level 50.
This is what is expected on Diageo, and the northward journey may hold till the end of this year.
This forecast is ended by the quote below:
“Protective stop orders to the trader are as important as the oxygen tank to the Astronaut in outer space. Without them, and proper use of them, you’re in big trouble… On the emotion side of trading, I don’t feel any different about a winning trade or a losing trade. Perhaps the fact that I have been doing this so long is a factor but the reality is, I am simply executing a profitable plan over and over and over. Small losses are just part of a very profitable plan that does not allow for big losses.” – Sam Seiden (Source: Tradingacademy.com)
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