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TheStreet Open House

5 Huge Stocks to Trade for Gains in March

KBR

We're seeing the exact same ascending triangle setup in shares of engineering firm KBR (KBR). Like AAP, this stock is seeing a horizontal resistance level above shares at $32, and an uptrend on the lower end of shares' range. The breakout above $32 is the buy signal in KBR.

With any technical pattern, it's critical to think in terms of buyers and sellers - not shapes. After all, triangles, head and shoulders patterns, and the like are a good way of describing what's happening on a chart, but they're not the reason why it's tradable. Instead, that all comes down to the supply and demand caused by those buyers and sellers.

The horizontal resistance level at $32 is a place where a glut of sellers has been willing to step in and put a ceiling in the stock. A breakout would mean that increasingly eager buyers have absorbed all of the excess supply of shares sitting at that level -- and without that barrier in place, shares could rally much higher than that.

That's why it makes sense to buy KBR on a push through $32.

To see this week's trades in action, check out this week's Must-See Charts portfolio on Stockpickr.

-- Written by Jonas Elmerraji in Baltimore.

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At the time of publication, author had no positions in stocks mentioned.

Jonas Elmerraji, CMT, is a senior market analyst at Agora Financial in Baltimore and a contributor to TheStreet. Before that, he managed a portfolio of stocks for an investment advisory returned 15% in 2008. He has been featured in Forbes , Investor's Business Daily, and on CNBC.com. Jonas holds a degree in financial economics from UMBC and the Chartered Market Technician designation.

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