%20DCN.png)
After gapping down and basing for 5 months with easily defined resistance, DCN broke out on steady volume that lasted well over a month. Maybe you can call it a head & shoulder pattern with two shoulders on each side…it doesn't matter. The only important features are the size of the base (5 months) and the volume on the breakout. We got both, so it doesn't matter what you call the pattern.
%20AXL.png)
AXL was generally trading neutral with easily defined trendline resistance overhead. Until the stock breaks out on volume, there isn't much to do from a “chart pattern” standpoint other than play the range. But once resistance is taken out on big volume, the stock become playable to the upside.
%20CNX.png)
CNX is another simple example of a trendline being used to determine entry on a trade. Resistance is formed by a couple touches, and volume pops on the breakout. Notice how the pricing action on the rally after the breakout is very similar to the pricing action on the move up into the pattern.
%20IMAX.png)
IMAX didn't really fit well into the bullish wedge, flag or pennant patterns, but the pattern was too good to ignore. In this case we just plop it into our bullish trendline category and play the volume breakout like any other continuation pattern.
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