Back To Breakouts
Today’s Watchlist:Â Â
(
IBM |
Quote |
Chart |
News |
PowerRating),
(
DGX |
Quote |
Chart |
News |
PowerRating)
The green line on the charts is the 200-day MA and the blue line is the
50-day MA.
IBM
(
IBM |
Quote |
Chart |
News |
PowerRating) broke out on Friday after forming a large
four-month cup. The volume began to pick up during the breakout, and it is again
showing strength on the continuation day. This is the type of leadership that we
need to see continue to take the market higher. If IBM can sustain this move,
along with the other big-name techs, then we may be seeing the beginning of
something good.
Quest Diagnostics
(
DGX |
Quote |
Chart |
News |
PowerRating) is like the little engine that could. It has been
trending higher for months, with buyers appearing on each pullback. It formed
another high-level cup in late-July and August. Friday it tested resistance one
last time before breaking out on Monday. As it takes out its previous high, we
will prepare for a continuation move. Look for a high-volume new-high close in
the top 15% of today’s range and then set your alerts near the intraday high for
a potential second leg higher on Tuesday.Â
Manugistics
(
MANU |
Quote |
Chart |
News |
PowerRating) surged higher on Monday on very strong
volume. Like the other breakout plays that we are monitoring, we will look for a
new closing high. The volume is already strong, so that is not a factor at this
point. Ideally, MANU will close in the top of its range, to provide a bit more
assurance of the strength of a continuation move. If it can close at a new high,
watch for it to trade above Monday’s intraday high. Because the market is still
choppy, you may consider using a tighter-than-average stop.
Until later,Â