Take a look at the 1-year chart of Agios (Nasdaq: AGIO) with the added notations:
From March thru mid-September AGIO repeatedly stalled at $50 (blue). Finally, the stock broke through that $50 on a massive increase in volume. After hitting resistance at $70 the stock has fallen into what is known as a flag pattern. The pattern gets its name from the appearance of a “flagpole” on the breakout, and a small pennant formation after. This type of price action usually implies a break higher, but is certainly not a guarantee.
The Tale of the Tape: AGIO is consolidating within a flag pattern. A break above $65 should lead to higher prices, thus a long trade could be made, and a break below $60 should lead to lower prices and a short opportunity.
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