TradingMarkets Chart of the Day

For today’s Chart of the Day, let’s take a look at the

Pullback from New Highs List
on the
page. Most successful momentum-based traders and money managers like to
buy strong stocks after they pull back. uses a proprietary
mathematical model to identify up to 30 (in weak or choppy markets there will be
fewer) of the strongest stocks that have pulled back from recent highs. These
stocks should be considered potential candidates to resume their longer-term

General Motors
GM |
Quote |
Chart |
News |
been in a confirmed up-trend since May, riding high above its 200-day

moving average
Last week, on July 26, GM made 9-month highs, trading as high $33.06.
After hitting those highs, GM issued a small pullback, losing about $3 over the
next week. Look for GM to continue its move up and test resistance at the
new highs. Yesterday the stock closed at the very top of its range, also a
very bullish signal.

Remember: Pullbacks are
great opportunities for buyers to get in at a better price. When a strong
stock declines for a few days towards its support, do not lose faith.
Instead, get ready for the stock to pop and continue in the direction of its

John Patrick Lee