The correction in the uptrend has been clearly done, even a new little high has been built, the indicators are up. Let's assume that the uptrend will continue.
This is a simple setup. Find a stock that is in an uptrend, wait for a correction that forms a descending channel, then go long on the first pullback after a breakout of the descending channel. Go long on a pullback to the "Entry" zone, which is a confluence of the ascending channel (red) within the larger ascending channel (black) and the descending channel....
BMY (Daily). Potential Correction.
Range Limit reached.
Regression Channel upper bound.
Bearish Pin bar. at resistance.
BB stretched.
RSI at potential overbought levels.
OBV at horizontal resistance.
Vs SPX500 Ratio reaching upper bound channel.
Breaking and sustaining this level, opens the door for further upside.
When I see a stock go from 2.6 times sales to 6.4 times sales while revenues have fallen from $21 billion to $16 billion, you can tell that investors are hoping for something big coming down the road.
For now, I'll look for a trip down to the lower end of the rising regression channel.
Risk - $64 or $65. Target $53-$54.
Tim 4:25PM EST Feb 27, 2015
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