Two Chemical Names Turning Positive
On Dec. 23, I wrote about the charts of W.R.Grace (GRA) and Solutia (SOA), two specialty chemical companies with technically sound charts, but overbought Stochastic indicators. At that time, I commented " over the intermediate term both stocks should track higher, so entering a partial long position at current levels and adding to it on pullbacks is a prudent strategy." Both stocks have continued modestly higher, but have yet to correct. Today, I offer two more specialty chemical companies with a repeat of the same trading strategy.
Chemtura (CHMT) began trading publically 14 months ago. It moved steadily higher in its first eight months of trading and then fell off a cliff in July of last year, losing 50% of its value over the next three months. After making a low, it began trading in a symmetrical triangle consolidation, reverting around its 50-day moving average. This week it is moving above the downtrend line of the triangle pattern. The weekly Relative Strength Indicator is moving above its centerline, and MacD has made a bullish crossover. While overall volume has declined during the consolidation phase, money flow has remained clearly positive....242 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.
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