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Monday, September 20, 2010

WLL

Cutting down the relative strength list to 100 stocks paid off today, as it was much easier to find the good breakouts. WLL was one of the better looking ones, as it brike through a tough resistance level on decent, but not great, volume. This is a very wide pattern with a poorly formed handle (which actually looks like a short cup). A common characteristic of today's breakouts is a pric relative line that did not hit a new high, which is a potential red flag. On a chart like this, i would prefer to wait to see if this pulls back before entering, rather than jumping on the breakout, as it does look potentially weak. If it takes off without pulling back, well, it just got away.

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