Figure 1: Weekly chart of TTH.
Looking at the weekly chart, TTH broke above the trendline extending down from January 2000 with a strong advance in the first half of 2003. The stock pulled back from its July high (red arrow) and formed a higher low in October (green arrow). Notice how trendline resistance turned into support as the line extended into the second half of 2003. With a reaction low in October, a symmetrical triangle took shape and the breakout projects further strength to the mid 30s over the next few months. This target was found by extending a trendline parallel to the lower trendline of the symmetrical triangle.
|Figure 2: Daily chart of TTH.|
|Graphic provided by: MetaStock.|
|Looking at the daily chart, the formation over the last few months looks like a cup with handle. Volume expanded as the right side of the cup formed and the handle represents a consolidation. These are bullish continuation patterns that require a break above the rim for confirmation. The rim is a resistance line that extends from the left edge of the cup to the handle (red line). A move above 29.5 would signal a continuation higher and project further strength to around 34. The height of the pattern (rim less base) is added to the rim breakout for a target. Look for volume to confirm any breakout.|
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