Actionable news
All posts from Actionable news
Actionable news in LLY: ELI LILLY & CO.,

Tech Talk: A Selling Climax And Other Ephemera

I was looking through my stocks today for a double bottom today, but found instead another rising pattern.

I have drawn a W-like pattern in this chart, but the “W” looks much like my scrawl in real life: barely legible. Traditionally, the two bottoms in a W formation reach the same level, which indicates support. (And ideally, the lines in this formation should be clean – they should not go through candlesticks to create the pattern. When they occur, however, W patterns are a strong sign of good news ahead.

So this is not a proper buy signal in the classic sense of the word. However, two other features make this chart interesting. One is the selling climax in March: The stock gapped down to hit rock bottom on extremely high volume. It struggled for a while to recover, but at the end of June did so – again, on high volume. Selling...