Tight Weekly Ranges

Jan 18, 2022 07:20 AM 0 Answers
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Hi Marty,

It is often talked about that we need to see tight weekly trading ranges (3 weeks +) in a base for a breakout to be successful. Out of the recent breakouts of TECK, ZIM and AMAT, would you say that all 3 have traded within a narrow range on the weekly prior to breakout?


I am glad you are referring to weekly charts.

TECK was trading tight and formed a bull flag prior to its breakout. This is the type of stock that the large institutions are buying during this most recent sector rotation.ZIM formed a cup with handle pattern with a viscous shakeout in the handle. It is a bit more wide and loose (likely due to massive dividend payment). This stock continues to make higher lows, and higher highs.AMAT This one traded tightly in a flat base pattern before its breakout as well. It also had a strong shakeout prior to its breakout. The stock was down more than 4% in the week prior to its move to new highs. But, the move came with lighter volume.

Keep looking for that tight trading while the stock is still in its base. Even though the stock market is weak there will always be stocks performing well.



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