A double-top pattern is formed by two swing highs that come in at approximately the same price level. They're separated by a swing low that's the breakdown level for the pattern - a move below that low triggers the sell signal in shares. For REGN, that sell signal comes on a move below $165.
As a shareholder, it's important to remember that it doesn't matter why selling pressure is coming into this stock right now -- the two tops on this chart show us that it is. Now, it's just a question of whether that newly introduced selling pressure can overcome the holdout buyers sitting below that $165 level. If they do (with a breakdown), then it's time to exit this stock -- or even bet against it.If you decide to take the short-side, I'd recommend keeping a stop on the other side of the 50-day moving average. To see this week's trades in action, check out the Technical Setups for the Week portfolio on Stockpickr.
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