Wednesday, February 16, 2011

SHZ Long

I don't think this stock is big enough to see the pattern recognition/manipulation we see in other stocks, therefore I'm more inclined to trust a breakout from the triangle you will see below.

We saw a nice run and a pullback which has narrowed the trading range into a consolidation triangle.

 Toy can see 3C calling the pullback from the first major run up and now showing a positive divergence in the triangle, which is a little rare to see.

 Again the 15 min chart confirms.

Here are a couple of potential stops, one at the trend channel near $6.30 and another around $6.65, depending on how you decide to enter the trade. I'd probably set an alert for  breakout of the triangle and see if we can't get a second leg up out of SHZ.

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