As long as we're on the subject of non-textbook technical patterns, let's take a look at another pharmaceutical giant, Bristol-Myers Squibb (BMY). BMY is another name that's been rallying hard in the last few months, buoyed by strong fundamental changes like earnings and acquisitions. But in the near-term, traders should be focusing on the technicals for this stock.
BMY is currently forming a cup-and-handle pattern, a setup that's a tad bit more obscure than an ascending triangle, but largely works for the same reasons -- in both, you're looking for that breakout above resistance. For BMY, the level to watch is $34.75.
I mentioned that BMY's setup isn't textbook. That's because shares didn't make it back up to resistance before they started forming the handle. The fact that shares tested $34.75 resistance last week and failed makes up for the -- it means that there's still significant supply above that price level, and it makes a breakout all the more valid.Bristol-Myers shows up on a recent list of the 10 Longest-Held Stocks of Top-Rated Mutual Funds.
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