|In my article Tibco Software Diamond Bottom, I discussed a bullish diamond bottom formation that had formed and suggested watching it for signs of a breakout on volume. Another look reveals a bullish consolidation flag pattern forming, demonstrating that traders and investors appear to have been accumulating during the Christmas season.|
|The Santa Claus rally that everyone was hoping for materialized between Christmas and New Year's Day and there is every indication that, barring some unforeseen negative geopolitical or economic event, the good times should continue into January, and with a little help, Tibco should be joining the party. |
One caveat, however. It is not a good idea to jump aboard until the top flag resistance line is broken on volume close to the 8 million mark set on the last gap on December 18. Volume exceeding this amount on an upside break would be clear evidence that the consolidation is over and the elevator is going up again. Next stop: $7.60.
|Figure 1: Daily chart of Tibco Software (TIBX-OTC) showing the recent bullish flag pattern forming in the final days of 2003. Also note the bullish divergence (blue line) on the stochasticRSI (upper window). Traders will be looking for a volume spike similar to the last gap on a breakout about $7.10. Also note the longer-term resistance line (dashed blue line) at $7.06. There is no further resistance until the $7.60 range.|
|Graphic provided by: MetaStock.|
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