Last up is
, the ore giant from down under. BHP has been selling off over the course of 2013, down 15% at the same time that the broad market has managed to rally around 17% in the other direction. For portfolio managers whose performance is based on a benchmark, BHP has been a portfolio drag all year long. But that could be about to change...
Right now, BHP Billiton is forming an inverse head and shoulders setup, a bullish reversal pattern that indicates exhaustion among sellers. The inverse head and shoulders is formed by two swing lows that bottom out at approximately the same price level (the shoulders), separated by a deeper swing low (the head). The buy signal comes when shares push through the neckline that's acted as resistance over the course of the pattern. Since this setup has been forming in the long-term, the upside implications are long-term once it triggers...
adds some confirmation to this trade - 14-day RSI has been in an uptrend since the middle of the summer when BHP's price action was still chugging lower. A move through the neckline in September means that upside looks likely...
To see this week's trades in action, check out the
Technical Setups for the Week portfolio
-- Written by Jonas Elmerraji in Baltimore.
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At the time of publication, author had no positions in stocks mentioned.