Stalking Convergence
Often when moving averages converge, it is the signal of a turn, or a
harbinger of the next move higher. Two stocks with high 3-month
relative strength rankings from TradingMarkets.com are setting up into
potentially bullish patterns on their daily charts in conjunction with the
converging 20- and 50-day moving averages. Cross Timbers Oil
(
XTO |
Quote |
Chart |
News |
PowerRating) is
tracing out a cup and handle, with the final portion of the handle occurring off
a bounce from the confluence of these moving averages.
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At the same time, Westwood One
(
WON |
Quote |
Chart |
News |
PowerRating) is putting the finishing touches
on a mini inverted head and shoulders at the level of the converging 20- and 50-day MA’s.
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Keep your eyes on these two for possible moves to the upside out
the patterns.
Until tomorrow,
Duke.
P.S. I really enjoyed meeting and talking with all of you who
attended the Kevin Haggerty Trading With the Generals seminar in Naples
this past weekend. Thanks to all of you for your kind comments and ideas to help
improve the service we provide.