Opposing Trajectories

Coca-Cola (KO) may be ready to break above an important resistance level, and electronics component manufacturer Molex (MOLX) looks like it will break below significant support.

In early August, KO made new highs and then had a sharp 8.5% pullback, which took the stock to the 38% retracement level of the August 2011 low and the August 2012 high. It bounced back up to the 50-day moving average in early September and then made a higher low later that month. The price action formed a cup-and-handle pattern with rim line resistance in the $38.80 area. Stochastics has made a bullish crossover above its centerline, and the Relative Strength Indicator and Moving Average Convergence-Divergence are both trending higher and above their centerlines. Volume weakened in October but money flow, while negative, has stabilized and the Chaikin Oscillator, a measure of three- and 10-day accumulation/distribution, is crossing above its 21-period signal average....231 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.

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