Schwab's Pullback Begins

Shares of Charles Schwab (SCHW) appear to be on the verge of a long-overdue pullback. The stock is dropping to fresh August lows, with the help of a 1.9% loss. This loss has pushed Schwab's stock through the lower trendline of a very healthy bullish channel that has been in place since the May low. At last week's high, the stock had surged over 40% off major support near the May 2 spike low. Schwab's powerful three-month run may be ending this week.

Schwab has been on a tear since May 2. The stock left behind four straight monthly lows before the major 12-week bull run took hold. Upside volume remained very robust through the first three-quarters of the move. By the start of July, it was becoming obvious that the momentum was fading. Schwab hit $22.50 in the second week of May, marking the start of a five-week struggle. The stock put in a weekly high later in the month at this level and did so again this month with back-to-back highs. As Schwab drifts further below the trendline support that links the May and July lows, a significant top may be in place....99 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.

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