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RESISTANCE LINE


Alaska Air Is Flying

12/23/08 02:13:50 PM
by James Kupfer

Alaska Air has more than doubled since its July 2008 bottom. Is now the time to buy?

Security:   ALK
Position:   Hold

After hitting a low of $10.10 in July 2008, Alaska Air has soared in price and is now in the $27–28 range. Given the massive runup, is now the time to buy or sell?

Looking at the chart (Figure 1), you can see that ALK has made a series of higher highs and higher lows, a bullish sign. Over the last month in particular, ALK had a very large move and formed a steep trendline (green) that is providing continued support for an upward move.

FIGURE 1: ALK, DAILY. Alaska Air must overcome resistance before moving higher.
Graphic provided by: Wealth-lab.
 
There is, however, some significant resistance that ALK must overcome before moving significantly higher. Old resistance from previous peaks lay at $28.50–29.00. This may well serve as a ceiling on the stock. If ALK can move north of $29, however, $36 would be the first price target. This one is worth watching for such a move.



James Kupfer

Mr. Kupfer is a market professional and amateur stock market commentator. Disclosure: It is likely that Mr. Kupfer has or will enter a position in any security he writes about.


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