These Look Primed for Breakout

When we see consolidation around a key moving average that forms a clear bullish chart pattern, that sets up a trade with high odds for success. Two stocks have been forming this type pattern around their 50-day moving averages since the beginning of June, and they may be preparing to break out.

Verizon (VZ) -- Daily Source: View Chart » View in New Window »

Verizon Communications (VZ) dropped below its 50-day line in May, and stabilized in early June at the 50% retracement level of its 2013 range. The stock then made a series of higher lows, but was unable to break above the $51.50 level. This price action formed the triangle. Momentum and short term trend indicators are sitting flat on their centerlines -- and, while volume is light, the money flow indicators are positive. Bollinger band width is at an extremely contracted level, as indicated on the graph at the bottom of the chart, and it suggests that a pattern break in either direction could be volatile. ...222 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.

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