Strength Triggers 3 Breakouts

The opening strength in the broader market triggered a number of breakouts in stocks with tight consolidation patterns. As has been the case for some time, the enthusiasm in the early session has quieted and sideways price action is likely until confirmation or repudiation in the final hour of trading.

Business-services company Alliance Data Systems (ADS) was one stock that broke out of two-month consolidation at the open, only to pull back into channel range. The Relative Strength Index is above its centerline and 21-period average, moving average convergence/divergence is making a bullish crossover, and two very strong volume bars last week pulled the Money Flow Index above its centerline. There is 18% short interest in the stock, which could power it higher, and a close in upper candle range above the channel top would be a long entry point....203 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.

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