Tear Out Peco For Your Scrapbook
One of the things I’ve noticed winning traders do is
that they save the charts that have technical and fundamental setups that are
textbook examples to model future trades after.
Today, I saw a setup in Peco Energy
(
PE |
Quote |
Chart |
News |
PowerRating) which I would encourage anyone
with a mindset to improve as a trader to print out and study.
I don’t think you could have asked for any better example of how a volume
accumulation pattern can foreshadow an explosive breakout to new highs in a
stock. A week ago, PE was lazily climbing within a three-week range. But a
sudden surge in volume provided a telltale sign that suggested a big move
might be on the horizon. That technical pattern, coupled with the fundamental
backdrop of money flying out of tech stocks into defensive sectors such as
energy, should have alerted the astute trader to an opportunity with good
risk/reward characteristics.
Was I one of those astute traders? No. And if you weren’t either, you can
still benefit from this setup by saving this chart in your scrap book. Next time
you see a similar pattern unfolding in a stock, you may get a flashback to what
I’m showing you above.
See you tomorrow,
Eddie