Forum Archive Index - July 2001

[Phaedrus <Phaedrus@techemail.com>]

<<< The volatility of this share price in recent weeks has certainly got me at 
sixes and sevens...... I would love to see what insight Phaedrus is able to 
offer for the technically challenged.  Michael Phillips >>>
   Michael,
            Over the last 18 months CEN has been forming a classical Ascending 
Triangle formation. These are created when the upper trendline is flat, and the 
lower trendline is rising. This indicates that buyers are more aggressive than 
sellers. This formation is commonly part of an uptrend, and is considered a 
continuation pattern. It can occur, however, as a bottoming pattern, as is the 
case here. The pattern is Bullish whenever it occurs, meaning it is usually 
followed by a breakout to the upside. This happened on 6/7/01 when prices 
closed above $3.09 for the first time in 16 months. Some TA books advocate 
extending the height of the triangle up from the resistance level, and regard 
this as a price target ($3.80 in this case)
   I have circled several logical buying zones in red. These are where price 
action has "respected" and thus confirmed the rising trendline. The most recent 
one was when prices broke through the well established Resistance level of 
$3.09, another logical Buy point.
   Far from being chaotic or confusing, the price action of this stock over the 
last year and a half has been very orderly. Even if all you did was draw the 
rising trend line, it was clear which way prices were headed.   
             Regards,
                         Phaedrus.


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