I'm about to buy GPRO at an average price of 48.73. Factually speaking the daily 8 SMA is at 48.60 and S2 today is 48.82. And now the guessing. I am presuming that there are smart buyers in the world that pay attention to these things and dumb sellers in the world who don't. That's life, right? C'est La Vie, may the best man win.
But wait, how do I know I'm not the dummy? After all I am taking these man made technical creations and applying them to my craft all the while assuming they work. GPRO is in a confirmed downtrend in all time frames but the daily which is bullish (above 50 day, earnings gap). So yes, there is a chance that I am the dummy. However, if I get a little creative with things maybe I can be the dumb guy less than half the time.
So what else is up my sleeve? Nothing fancy. Earnings were good and confirmed by price action and volume that day. Additionally, selling volume is diminishing on the daily chart in the last 4 days. Against my favor is a weakening market right now. That's it. If I'm wrong I lose 2R, if I'm right I make 4R+. We shall see.