Combining Strength With Familiar Reversal Patterns
Combining reversal patterns
with a stock
that has demonstrated relative strength vs. the rest
of the pack is one way to find potential low-risk, high-return entries.
One way to find issues that fit the bill is to go
to
TMs Indicators page and scan the different categories under the header
Stocks. In today’s trade coming in, one such issue that proved stronger than
most in yesterday’s trade, and has shown daily strength as of late by carving
out a high level daily base–was Biogen Idec
(
BIIB |
Quote |
Chart |
News |
PowerRating). In today’s
trade though, BIIB was trading off, as many recent laggards were swept up by the
so called ‘smart money’, as profit-taking quickly turned into bargain hunting.
But, therein lies the potential for opportunity as an initial reversal pattern
was carved out…
11:23:45
Intraday Setup Alert
Biogen Idec (BIIB)
was a member of last night’s
3 Day Wake Up Call. With the stock off .67 at 53.97, the issue has
pulled back in today’s trade on below-average volume. Intraday, with the stock
forming a symmetrical
triangle, there might be an opportunity for potential reversal longs should
pattern resistance of 54.25 be cleared.
The first pattern, while not triggering any longs, gave way to another familiar
formation called the
Cup and Handle. We’ll have to wait and see what happens,
but if investors do finally decide to grab Biogen Idec by the handle–I know
that’s a stock I’d like to take more than a look at as well.