VSTR’s Cup To Runneth?
Pattern setups combined with price action can be a powerful tool for traders.
In the Insights From The War Room, our
team of analysts are often looking at the java applet themselves to find
potential trading candidates. Since the alerts are not direct buy or sell
recommendations or mechanized system alerts, when an alert comes across the
applet, the first thing to do for both swing and daytraders is to look at the
daily chart for a confirming pattern that fits their style or methodology.
VoiceStream Wireless
(
VSTR |
Quote |
Chart |
News |
PowerRating) came across the applet at 12:42 EDT
as it was retouching its 50-day moving average. A look at VSTR’s daily shows that it is
pulling back into a low-level mini cup and handle. Further analysis reveals a
triple top in its base being traced out since the first week of March.
Â
Â
Jeff Cooper often will track these formations, which he has
named the Rule of Four setup, looking for a breakout over the triple top. Will
VSTR head higher? I don’t know for certain, but if the Nasdaq Composite
(
COMPX |
Quote |
Chart |
News |
PowerRating)
is stoking the fire for a run higher and VSTR can take out the triple top,
it has room to make a run back up toward the February high with little apparent
resistance in the way. Definitely an issue worth keeping an eye on.
Until tomorrow,
Duke