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TheStreet Open House

5 Eurozone Technical Setups for Breakout Gains

Unilever

A very similar setup is taking shape in shares of Unilever (UN), the $94 billion Dutch-domiciled household products group that owns well-known brands such as Dove soap and Lipton tea. Like Statoil, Unilever is forming an ascending triangle setup, in this case with resistance at the $35 level. That's the price to watch.

One way to think about how resistance levels work is that $35 is a price for Unilever where sellers become more eager to sell and take gains than buyers are to buy. When that happens, a glut of potential supply of UN shares forms above $35, and that price becomes a sort of ceiling for shares. A breakout above that level, though, indicates that buyers have finally absorbed all of the excess supply at that level, clearing the way for more upside in shares.

At first glance, one thing that's obvious in Unilever's chart is the abundance of gaps. Those gaps may make the chart look somewhat less well-defined than that of Statoil, but they can be ignored for all intents and purposes. Those gaps, called suspension gaps, occur because Unilever's shares trade off U.S. hours on the London and Amsterdam stock exchanges. From a technical standpoint, they're not significant.

Unilever, one of the top-yielding food and beverage stocks, shows up on a list of 5 "Exceptional Buys" for 2012.

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